Tax time is coming fast but most of you have hopefully already filed if you are liable to file. I know those expecting refunds are usually the first to file every year. I know I was. The years I owed I waited until April 14th because I did not want to be one of those cramming the mailboxes with my return. You want to keep your money as long as you can naturally.
Usually if you have your withholding or form W-4 filled out correctly with your employer, you will not owe at the end of the year and should get a small refund back depending on any credits and the amount of your deductions for the year. Few are exempt from withholding. You should never be getting a huge refund back or owe a lot unless there were extenuating circumstances for that tax year. If the IRS finds that you are using them as a bank during the year by low-balling your exemptions thereby more money is being withheld during the year that will only need to be returned back to you next year. The IRS does not like refunding for any reason unless they have to but you shouldn’t have any problems if it’s one or two exemptions lower or you file zero and you are single. If you claim zero but have 5 people in your family and expect many thousands of dollars in a refund you may get a form letter in the mail asking you to make the proper adjustment to your W-4 at work.
If you are on the other end of the scale, and input a false number for your exemptions so you can take home most if not all of your withholding during the year and you end up owing, you better be able to pay it off entirely by April 15th or you could end up the many that the IRS will send a memo to your employer requesting maximum withholding for a specified period of time as your “punishment.”
Tax fraud is at an all time high and you must be vigilant to protect yourself. There are phishing and downright scams going on all the time with people trying to prey on others. Please click on HELP if you wish to get more information on these subjects and how to respond appropriately.
There are also those that file false returns under other people’s identity. Click on HELP for information on how to resolve any type of tax identity fraud.
As long as you follow the basic rules of what the IRS expects from you, you shouldn’t have problems with them. If you have a hard time following instructions or the law or are deliberately trying to pull something, then expect to hear from them and depending on what the issue is, they can come down on people very hard with penalties and interest that accrue like crazy! If you ever find yourself with collection issues, please contact the IRS right away BUT….This is very important….NEVER CONTACT SOMEONE IF YOU THINK IT IS FRAUD!! Just refer to the above help links with the IRS for procedures or you could risk a virus to your computer or worse. If you are expecting to hear from the IRS about back tax or something else, then just verify the address and phone number with their website if you want to play it safe, and then call them. They almost never send emails!