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Just wanted to add another point - while there's no failure-to-file penalty when you're due a refund, there IS a deadline for claiming that refund. You have 3 years from the ORIGINAL due date (not the extension date) to file and claim your refund. So for 2024 taxes, you'd need to file by April 15, 2028, or you forfeit your refund completely. The government keeps your money if you don't file within that window!
Thanks for this additional info! I definitely will file long before that 3-year deadline hits, but good to know there's an absolute cutoff. Does the same apply for state taxes or does that vary by state?
The 3-year refund claim deadline is for federal taxes. State tax deadlines vary by state - some follow the federal 3-year rule, while others have shorter or occasionally longer timeframes. For example, California and New York generally follow the federal 3-year rule, but some states like Montana only give you 2 years to claim a refund. I'd recommend checking your specific state's tax agency website for their rules since it's not standardized across all states.
Something to consider - even though there's no penalty, waiting to file when you're owed a refund is basically giving the government an interest-free loan. If your refund is substantial (like over $1000), that's money that could be in your account earning interest or paying down debt.
True, but with the current disaster at the IRS with processing times, you might not get that refund anytime soon anyway. My brother filed in April and just got his refund last week!
Have you considered that your refund might be delayed because it's your first time filing? The IRS sometimes puts extra verification steps on first-time filers to prevent fraud. My first return took around 31 days even though it was super simple. Also, pro tip: if you're getting a sizable refund, you might want to adjust your W-4 withholding with your employer. A big refund feels nice, but it basically means you gave the government an interest-free loan of your money all year!
Oh I hadn't thought about being flagged as a first-time filer! That actually makes a lot of sense. 31 days isn't terrible I guess, just longer than that 21 day estimate. What's the best way to adjust withholding? I'd rather have the money throughout the year for sure, but I'm nervous about accidentally owing taxes next year if I mess with my W-4.
The easiest way to adjust your withholding is to fill out a new W-4 form with your employer. The form was redesigned in 2020 to be more straightforward. If you want to be conservative about it, you can start by claiming just a little less withholding and see how it affects your paychecks. The IRS has a Tax Withholding Estimator tool on their website that can help calculate the right amount based on your specific situation. It's better to slightly overwithhold than underwithhold, so you still get a small refund rather than owing money at tax time. Just update your W-4 with your employer's HR department once you figure out the right numbers.
My refund timeline from filing to deposit this year: Filed electronically on Feb 3 Acceptance confirmation Feb 4 Refund approved Feb 14 Deposit hit my account Feb 16 So about 13 days total from filing to money in my account. Not bad!
What tax software did you use? I'm wondering if some get processed faster than others.
I went through this exact same situation with a small private school I worked for. Here's what happened: they gave me a 1099 but had been withholding taxes. I filed Form SS-8 with the IRS to determine my correct worker status, and Form 8919 with my tax return like someone mentioned above. The IRS ruled I was an employee and my employer got in serious trouble because they had been pocketing the withheld taxes rather than sending them to the IRS! Make sure you keep all your paystubs showing the withholding - that's key evidence. The good news is that the IRS waived all penalties for me since I reported it. The bad news is my employer had to pay significant penalties and back taxes. They actually went out of business a few months later (though they had other financial issues too).
How long did the whole process take from filing the SS-8 to getting a determination? I've heard the IRS is super backed up.
It took about 7 months to get the official determination after filing the SS-8. The IRS is definitely backed up with these cases. The good part was that I didn't have to wait for the determination to file my taxes - I filed Form 8919 with my return and explained the situation. I was able to file my taxes as an employee would (paying only my share of Social Security and Medicare taxes) while the determination was pending. When the official ruling came through, it confirmed I'd filed correctly. If you have solid evidence like paystubs showing withholding, you're in a pretty strong position.
One thing nobody has mentioned - GET A NEW JOB ASAP!!! Any employer pulling this kind of stunt is shady af and probably doing other illegal stuff too. My sister's daycare did the same thing and when the state investigated they found all kinds of violations beyond just the tax fraud.
3 Don't forget energy efficiency tax credits if you made any improvements! I bought a fixer-upper last year and got credits for: - New energy efficient windows ($600 credit) - Heat pump water heater ($2,000 credit) - Added insulation ($1,200 credit) These are straight tax credits, not deductions, so they directly reduce what you owe. Check out Form 5695 - the credits were expanded under the Inflation Reduction Act.
8 Do these credits apply if the improvements were done by the previous owner right before selling? The listing mentioned they installed new energy efficient windows and HVAC a month before I bought the place.
3 Unfortunately, no. The energy efficiency tax credits only apply to improvements you made yourself after purchasing the home. The previous owner would have been eligible to claim those credits on their return, but you can't claim credits for improvements made before you owned the property. If you make your own energy efficient upgrades in the future though, definitely keep all receipts and manufacturer certifications. The credits are quite generous through 2032 under current law!
19 Quick tip for first-time homebuyers: if you withdrew money from an IRA for the down payment, you might qualify for an exception to the early withdrawal penalty (though you'll still pay income tax on the distribution). Up to $10,000 can be withdrawn penalty-free for a first-time home purchase. Check out Form 5329!
11 Is this true for Roth IRAs too? I took out some money from my Roth for closing costs and wasn't sure if I needed to report it.
Esmeralda GΓ³mez
One thing nobody mentioned - depending on when you originally filed, you might want to wait a bit before submitting an amendment. The IRS recommends waiting until your original return is processed before filing a 1040-X. If you file an amendment while your original return is still being processed, it can cause confusion in their system. You can check your return status on the IRS website. Given that the amounts are small, waiting a few extra weeks probably won't make much difference, but it could save you headaches down the road.
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Giovanni Rossi
β’That's super helpful, thanks! I filed my original return about 3 weeks ago. Do you know roughly how long I should wait before filing the amendment? And do you think I should use a tax professional for the amendment or can I do it myself with tax software?
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Esmeralda GΓ³mez
β’The IRS typically processes electronically filed returns within 21 days, so you're probably right at that threshold. I'd suggest checking your refund status on the "Where's My Refund" tool on IRS.gov. Once it shows your return has been processed, you're good to file the amendment. For amounts this small with just two additional 1099 forms, tax software should be perfectly adequate for the amendment. Most major tax software programs have an amendment feature. Just enter the additional information from your Robinhood 1099-B and Cash App 1099, and the software will generate the 1040-X form for you. The whole process should take less than 30 minutes.
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Klaus Schmidt
Random question - does anyone know if Robinhood reports cost basis to the IRS or just the sales amount? I've heard different things and I'm not sure if the IRS will know if the numbers are wrong.
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Aisha Patel
β’Robinhood does report cost basis to the IRS for most securities purchased after 2011. You can verify this on your 1099-B - if Box 1e (Cost or other basis) is filled in, then yes, the IRS is receiving that information. They know exactly what your gain/loss should be.
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