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QuickBooks is one of the most powerful tools on the market for managing small business finances, but getting started can feel daunting. Setting up your account properly and taking advantage of key features is the best way to save time and avoid headaches when tax season rolls around – we promise, your tax professional will thank you for staying on top of your books all year long!

Here are five detailed tips to help you navigate QuickBooks with confidence.

1. Customize Your Chart of Accounts

Your Chart of Accounts is the backbone of your bookkeeping system, and tailoring it to your business is critical. For example, an auto repair garage might include categories like “Parts Inventory” and “Repair Labor,” while a lawyer would focus on “Billable Hours” and “Client Retainers.”

• How to Access It: Go to the Settings ⚙️ menu in the top right corner, select Chart of Accounts, and click New to add categories or edit existing ones.
• Pro Tip: Break down your categories to match your income streams and expenses. For example, if you’re a retailer, you might include “Online Sales” and “In-Store Sales” as separate categories. This specificity makes reporting and tax preparation easier.

2. Link Your Bank and Credit Accounts

Syncing your financial accounts with QuickBooks automates transaction tracking and reduces manual data entry. This saves time and minimizes the risk of human error, ensuring your financial data is accurate and up-to-date when you need it.

• How to Do It: Click Banking from the left-hand menu, then choose Link Account. Follow the prompts to connect your bank or credit card.
• Pro Tip: After syncing, QuickBooks will pull in transactions automatically. Review these weekly under the Banking tab to categorize them correctly. Doing this regularly keeps your books up-to-date and avoids a year-end rush.

3. Set Up and Use Projects or Classes for Better Tracking

QuickBooks offers powerful features like Projects and Classes to track revenue and expenses for specific initiatives or departments. These tools provide a detailed breakdown of your financial activities, helping you analyze profitability and allocate resources more effectively for each project or division.

• How to Access It: Enable these features under Settings > Account and Settings > Advanced, then look for Projects or Track Classes.
• Why It Matters: If, for instance, you’re running a seasonal marketing campaign, you can group all related income and expenses under one project. This gives you a clear picture of the campaign’s profitability.

4. Master Recurring Transactions

Recurring transactions can save you significant time if you have clients who need regular invoicing or vendors you pay monthly. Automating these repetitive tasks lets you focus on growing your business while making sure you never miss payments or invoices.

• How to Set It Up: When creating an invoice, bill, or expense, look for the Make Recurring option at the bottom of the form. Customize the frequency, amount, and start/end dates.
• Pro Tip: Automate fixed costs like rent or subscription services. You can review all recurring transactions under Lists > Recurring Transactions.

5. Leverage QuickBooks Reports for Insights

QuickBooks comes with built-in reports that give you a comprehensive view of your business’s financial health. These reports allow you to identify trends, monitor cash flow, and make data-driven decisions to improve profitability and growth.

• How to Find Reports: Navigate to Reports in the left-hand menu. You’ll see a list of common reports, including Profit & Loss, Balance Sheet, and Cash Flow Statement.
• Pro Tip: Click Customize Report at the top to customize reports to your needs. You can adjust date ranges, filter by customer, or even compare performance over time. Save these customizations to access them quickly in the future.

Extra Tips for Tax Season Readiness

1. Reconcile Regularly: Under the Banking menu, click Reconcile to match your QuickBooks records with your bank statements. Doing this monthly avoids discrepancies and errors.
2. Track Receipts with the Mobile App: Download the QuickBooks mobile app and use it to snap pictures of receipts. They’ll be automatically uploaded and matched to transactions, making expense tracking a breeze.
3. Use Accountant Access: QuickBooks allows you to invite your accountant directly into the platform. Go to Settings > Manage Users > Invite Accountant to streamline collaboration during tax season.

QuickBooks does much more than bookkeeping for small business owners—it can mimic an entire finance department when used effectively. From creating a customized Chart of Accounts to taking advantage of detailed reports, these steps will help you stay organized and reduce stress during tax season (and all year long!)

Remember when “downsizing” was something you did to your closet every spring? Now, it’s a buzzword for a major financial move: selling the big family home to streamline expenses, pocket extra cash, or fund that dream RV trip. Especially for Baby Boomers and Gen Xers stepping into retirement territory, downsizing isn’t just about purging your dusty attic—it’s about deciding how you want to live the next chapter of your life.

But there’s a caveat. Before you pop that “For Sale” sign in the ground, you’ve gotta get tax-savvy. Because the IRS? They never miss an opportunity to tag along.

Capital Gains Taxes: The Big Kahuna

Let’s get right into the heavy stuff: capital gains taxes. Suppose you sell your long-time home for more than you paid for it—yay, profit! But that profit might be taxable. There is good news, though: if the property was your primary residence for at least two of the last five years, the IRS offers a sweet exclusion—up to $250,000 for single filers, and $500,000 if you’re married filing jointly.

Sounds too good to be true? Well, there are a few catches:

• Short Occupancy: If you haven’t lived in the house for that magic two-year window, or used it as a rental or business site, you’ll likely face a bigger tax bill.
• Multiple Properties: Selling more than one home? You don’t get to claim this exclusion twice in the same two-year period.

Essentially, don’t assume your sale profit automatically sails off tax-free. You might need to plan your timing or usage to snag the best tax breaks.

Tapping Into Sneaky Deductions

Yes, you can still find deductions—but it’s complicated. Recent legislation (looking at you, Tax Cuts and Jobs Act of 2017) capped state and local tax (SALT) deductions at $10,000. That might cramp your style if you live in a high-tax state.

The moving deduction is no longer allowed except for the military.

Leveraging the Sale for Retirement Funding

Downsizing can do more than trim your monthly bills—it can boost your golden years. Turn your home’s equity into rocket fuel for your retirement:

1. Time Your Sale Wisely: Selling in a strong market = bigger proceeds, and a well-structured sale can minimize your tax hit.
2. Park Funds in Tax-Advantaged Accounts: Rolling part of that new nest egg into IRAs or 401(k)s (up to the contribution limits) can help cushion your post-paycheck life.
3. Diversify, Diversify, Diversify: Talk to a financial advisor about distributing your proceeds into a blend of stocks, bonds, or even real estate investment trusts (REITs). Because “eggs” and “one basket” never end well.

Carrying Over Your Property Tax Basis (Sometimes)

Heard the rumor that you might get to carry your old property’s tax basis over to a new one? In certain places—California, we’re looking at you—this is more than a myth. Laws like Proposition 13 allow eligible homeowners to transfer their property tax base to a new home.

But the rules are notoriously finicky. Age requirements, property values, and county regulations can all squash your hopes if you don’t follow them to the letter. This is the kind of nuance that can save you bundles… or cost you if you mess it up.

Don’t Wing It

Let’s be real: the money you’ve spent a lifetime building is on the line here. You want to keep as much of it as possible—preferably for fun stuff like spoiling grandkids or traveling the world, not handing it over to Uncle Sam.

That’s why a little strategic planning goes a long way. And you don’t have to be the tax code’s best friend to do it right. You just need the right people in your corner.

Next Step: Dial Our Office for Tailored Tax Smarts

Ready to turn your downsizing dreams into a fully informed reality? We’ve got you.

Call or email our office now, and let’s chat through your situation—no generic, one-size-fits-all advice here. We’ll help you:

• Identify tax pitfalls specific to your property
• Pinpoint opportunities for deductions and exclusions
• Map out strategies to amplify your retirement savings

Don’t let confusion about capital gains or complicated tax rules derail your next life move. Get clarity today—and set yourself up for a smoother, more profitable transition into those well-earned golden years.

Remember: The smartest moves are made with eyes wide open… and a solid tax plan under your belt.

Running a small business is a round-the-clock hustle. You juggle employees, invoices, marketing, and a million other tasks that always demand your attention. The last thing you want is to overlook a perfectly legal tax deduction that could save you thousands—or worse, get stuck paying more than your fair share.

Ready for a quick win? Let’s dive into some powerful tax deductions that small business owners often miss—and learn how you can bank that extra cash instead.

1. Vehicle Expenses: More Than Just Mileage

Think of all the errands you run in your car for your business—client meetups, supply runs, on-site visits. Each of those trips could be padding your deduction total instead of draining your bank account on gas. The IRS offers two routes here:

• Standard Mileage Rate: Track how many miles you drive for business and multiply by the current IRS mileage rate.
• Actual Expenses: Deduct a portion of your actual vehicle expenses (gas, insurance, repairs, etc.).

Pro Tip: Choose the method that nets you the highest deduction. But remember—meticulous record-keeping is key. Apps like MileIQ are a lifesaver for logging those miles.

2. Home Office Deduction: It’s Not Just for Freelancers

If you use a portion of your home exclusively for business, you’re sitting on a deduction goldmine. That means a chunk of your mortgage or rent, utilities, and even repairs could be deductible on your business return.

• Exclusive Use: Keep that space business-only—no letting the kids watch Netflix there at night.
• Regular Use: Make sure you use this space regularly. (A corner desk you touch once a year won’t qualify.)

This one’s a game-changer when done correctly, so don’t overlook it if you work from home.

3. Equipment Depreciation: Turbocharge Your Assets

Buy a new laptop this year? What about that top-of-the-line printer or ergonomic office chair?

• Section 179: Deduct the full purchase price of qualifying equipment in the year you buy it.
• Depreciation: Spread the cost out over the asset’s useful life if it makes more financial sense.

The right strategy can seriously reduce your taxable income—so choose wisely based on your cash flow and growth plans.

Beyond the Basics: Your Custom Roadmap to Bigger Savings

Health insurance premiums, travel costs, even business meals—can all add up to major deductions if you know how to document them properly. It’s not just about what you can deduct, but how to ensure the IRS stays happy while you claim everything you’re entitled to.

Why Going DIY Could Cost You

Sure, you can try to handle taxes on your own. But with so many moving parts in the tax code, one slip could cost you big time—or leave dollars on the table that you could have reinvested in your business. Working with a tax pro isn’t just an expense. It’s an investment in peace of mind and bigger returns.

Let’s Make the Tax Code Work for You

Here’s the bottom line: Every dollar saved in taxes is a dollar that can drive your business forward—whether that’s hiring new talent, upgrading equipment, or simply boosting your personal paycheck. Don’t let hidden tax breaks slip through the cracks.

Looking to supercharge your deductions? That’s what we’re here for. Let’s take a deep dive into your finances, tailor the perfect tax strategy, and keep more money where it belongs: in your business.

Get in touch today for a consultation, and let’s start checking off those hidden tax opportunities—together.

Many individuals may find themselves earning below the income thresholds that require them to file a federal income tax return. However, even if you are not required to file, doing so may be beneficial. This article will explore the filing thresholds for 2024, the potential benefits of filing a tax return even when one isn’t required, and the refundable credits available, such as the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC).

• Filing Thresholds for 2024 – The filing thresholds for 2024 depend on your filing status, age, and type of income. Here are the general thresholds:
  • Single Filers: If you are under 65, the threshold is $14,600. For those 65 or older, it is $16,550.
  • Married Filing Jointly: For couples where both spouses are under age 65, the threshold is $29,200. If one spouse is 65 or older, it is $30,750, and if both are 65 or older, it is $32,300.
  • Married Filing Separately: The threshold is $5, regardless of age.
  • Head of Household: For those under 65, the threshold is $21,900. For those 65 or older, it is $23,850.
  • Surviving Spouse with Dependent Child: If under 65, the threshold is $29,200. For those 65 or older, it is $30,750. This status applies only for the first and second year after the year of the spouse’s death.

These thresholds are subject to change based on inflation adjustments and IRS updates, so it is always wise to check the latest figures when preparing your taxes.

• Why File a Tax Return Anyway? – Even if your income is below these thresholds, filing a tax return can be advantageous. The reason? You may qualify for refundable tax credits, which can provide a refund even if you owe no tax.
  • Earned Income Tax Credit (EITC): This credit is designed to benefit low- to moderate-income workers and can result in a significant refund.
  • Child Tax Credit (CTC): This credit can provide substantial financial support to families with children.
  • State Benefits: Some states offer additional credits or benefits that require a federal tax return to be filed in addition to the state return.
• Earned Income Tax Credit (EITC) – The EITC is a refundable tax credit aimed at helping low- to moderate-income workers. It can significantly reduce the amount of tax owed and may result in a refund.

Earned income includes wages, salaries, tips, and other taxable employee pay. It also includes net earnings from self-employment and certain disability payments. However, it does not include income from pensions, unemployment benefits, or Social Security.

The amount of EITC varies based on your income, filing status, and number of qualifying children. For 2024, the maximum credit amounts are approximately:

• No Children: Up to $632
• One Child: Up to $4,213
• Two Children: Up to $6,960
• Three or More Children: Up to $7,830

To qualify, you must meet certain criteria, including having earned income, a valid Social Security number, and filing a tax return. The credit amount decreases as income increases and phases out completely at higher income levels.

• Child Tax Credit (CTC) – The Child Tax Credit is another valuable benefit for families. It provides financial support for each qualifying child under the age of 17.
  • Amount of the Credit – For 2024, the CTC is up to $2,000 per qualifying child. Of this amount, up to $1,700 is refundable, meaning you can receive it as a refund even if you owe no tax.
  • Qualifying Children – To qualify, a child must meet several criteria, including age, relationship, residency, and support tests. The child must be under 17 at the end of the tax year, related to you, live with you for more than half the year, and not provide more than half of their own support.
  • High-Income Earners Phase Out – The CTC begins to phase out for higher-income earners. For 2024, the phase-out begins at $200,000 for single filers and $400,000 for married couples filing jointly. The credit is reduced by $50 for each $1,000 of income above these thresholds.

Filing a tax return, even when not required, can be beneficial for individuals with income below the filing thresholds. By filing, you may qualify for valuable refundable credits like the Earned Income Tax Credit and the Child Tax Credit, which can provide significant financial support. Understanding these credits and the filing thresholds can help you make informed decisions and potentially receive a refund that can aid in your financial well-being.

If you were not required to and did not file returns in the past, tax years 2021 2022, and 2023 are still open years, and returns for those years can still be filed for refundable credits that you are entitled to. However, note that the statute of limitations for filing the 2021 return for a refund expires after April 15, 2025.

Contact our office to determine what your benefit from filing may be and for assistance in preparing your current or past returns.

The world of college athletics has undergone significant changes in recent years, particularly with the introduction of Name, Image, and Likeness (NIL) income opportunities for student-athletes. As these athletes balance academics and sports, they must also navigate the complexities of taxation related to their various sources of income. This article explores the tax implications of NIL income, scholarships, grants, financial aid, part-time jobs, education credits, education loan interest and more.

Scholarships

Scholarships can be either taxable or non-taxable depending on how they are used and the terms of the scholarship. Here are the general rules:

• Non-Taxable Scholarships: Scholarships are generally non-taxable if they are used for qualified education expenses. These expenses typically include tuition, fees, and required books, supplies, and equipment for courses at an eligible educational institution. The scholarship must not exceed the amount of these expenses.
• Taxable Scholarships: If any part of the scholarship is used for non-qualified expenses, such as room and board, travel, or optional equipment, that portion is considered taxable income. Additionally, if the scholarship terms specify that it must be used for non-qualified expenses, it is taxable.
• Athletic Scholarships: These are often a mix of qualified and non-qualified funds. Student-athletes must carefully track how their scholarships are used to determine the taxable portion.

Reporting Requirements: Whether you need to report a scholarship on your tax return depends on whether any part of it is taxable. If the scholarship is entirely non-taxable, it generally does not need to be reported. However, if any portion is taxable, it must be included in your gross income.

Education Tax Credits: When calculating education tax credits, qualified tuition must be reduced by any tax-free scholarship amounts. However, if the scholarship terms allow, students can allocate funds to maximize tax benefits by choosing how to apply the scholarship to different expenses.

Understanding these rules can help in planning how to use scholarship funds effectively to minimize tax liability and maximize education tax credits.

Grants and Financial Aid

Pell Grants and other federal student aid are generally not taxable if they are used for qualified education expenses. Qualified education expenses typically include tuition and fees, books, supplies, and equipment required for courses as well as transportation and living expenses (such as room and board at the educational institution or off-campus rent).,

However, if a student chooses to apply the Pell Grant to non-qualified expenses, the amount used for those expenses must be included in gross income, which could make it taxable.

Pell Grants generally do not have to be repaid.

Income from NIL (Name, Image, and Likeness)

NIL is the acronym for name, image, and likeness. In 2020, the NCAA changed its rules to allow schools to pay athletes for academic performance, but this was overruled by the Supreme Court in the NCAA vs. Alston case, which removed limits on such payments. In July 2021, the NCAA adopted a policy allowing student-athletes to profit from their NIL, marking a significant shift in college sports.

Now student-athletes can earn NIL income through endorsements, sponsorships, social media promotions, autograph signings, and appearances. These earnings are typically treated as self-employment income.

Tax Reporting for NIL Income: Athletes receiving NIL income are generally considered independent contractors. They should receive Forms 1099-NEC or 1099-K, depending on the payment method. Athletes must report this income on their tax returns and may need to make estimated tax payments quarterly.  The income is generally reported as self-employment income on a 1040 Schedule C.

• Deductions and Expenses: Student-athletes can deduct ordinary and necessary business expenses related to their NIL income, such as travel, marketing, and professional fees related to the NIL income.
• Self-Employment Tax: Since NIL payments are generally considered self-employment income, student athletes must pay self-employment (SE) taxes if their net earnings exceed $400 in a tax year. SE tax is like the FICA (6.2%) and Medicare (1.45%) withholding for employees. The key difference is that while employers pay an amount equal to what their employees pay, self-employed individuals act as both employer and employee, thus paying both portions, resulting in a total SE tax rate of 15.3%. Unlike employees, who are taxed on their gross taxable wages, self-employed individuals are only subject to SE tax on their net profit, which is calculated as gross income minus business expenses deductions.
• Cryptocurrency: Occasionally a student athlete will receive NIL payments in cryptocurrency. When this occurs, there are several tax implications to consider:
• Income Recognition: Cryptocurrency received as payment for services, including NIL activities, is considered taxable income. The fair market value of the cryptocurrency at the time of receipt must be reported as income. Thus, a student-athlete receiving NIL payments in cryptocurrency would include that compensation, converted into U.S. dollars, on their Schedule C as part of their gross income.
• Capital Gains Tax: If the athlete holds the cryptocurrency and later sells or exchanges it for a different cryptocurrency or fiat currency, any gain or loss from the transaction will be subject to capital gains tax. The gain or loss is calculated based on the difference between the sale price and the fair market value at the time the cryptocurrency was received.
• Record Keeping: It is crucial for the athlete to maintain detailed records of all cryptocurrency transactions, including the date of receipt, fair market value at the time of receipt, and any subsequent sales or exchanges.

Overall, receiving NIL payments in cryptocurrency adds significant complexity to tax reporting and compliance.

NCAA Eligibility and Tax Considerations

Maintaining NCAA eligibility is crucial for student-athletes, and understanding the tax implications of their income is part of this process:

• Impact on Financial Aid: NIL income and other earnings can affect a student-athlete’s eligibility for need-based financial aid. It’s important to report all income accurately on the Free Application for Federal Student Aid (FAFSA).
• Compliance with NCAA Rules: While the NCAA now allows NIL income, athletes must still comply with institutional and conference rules. This includes understanding how income affects their amateur status and eligibility.

Part-Time Jobs

Many student-athletes take on part-time jobs to supplement their income. The income earned from these jobs is subject to federal and state income taxes. Key considerations include:

• W-2 Income: Employers provide a W-2 form detailing wages earned and taxes withheld. Student-athletes must report this income on their tax returns.
• Self-Employment: If a student-athlete engages in freelance work or gigs, they may be considered self-employed. This requires filing a Schedule C and paying self-employment taxes on net earnings over $400. If the student also has NIL income, the two are combined for SE tax purposes and the $400 limit applies to the combined total.

Student’s Standard Deduction

The standard deduction for a dependent, such as a full-time student-athlete under the age of 24, is calculated based on their earned income. This includes salaries, wages, tips, and other compensation for work performed, as well as any taxable portion of scholarships or fellowship grants.

• Dependent: A student who does not provide over half of their own support is claimed as a dependent by their parents. The standard deduction for such a dependent is the greater of $1,350 or their earned income plus $450, but it cannot exceed the regular standard deduction for a single filer, which is adjusted annually for inflation. If the student’s unearned income (such as interest and dividends) is more than $1,350 but less than $13,500, their parents have the option to claim this unearned income on their tax return.
• Non-Dependent: A non-dependent is a self-supporting student who pays more than half of their own support and does not qualify as a dependent. This student is eligible for the regular standard deduction, which is adjusted annually for inflation, and is $15,000 for 2025 if the student is not married or $30,000 if married a filing a joint return with their spouse.

Education Credit

The American Opportunity Tax Credit (AOTC) is a tax credit available to help offset the costs of higher education by reducing the amount of income tax the taxpayer may have to pay. For 2025, a credit of up to $2,500 for adjusted qualified education expenses paid for each student who qualifies for the credit may be claimed.

The credit is partially refundable: if the credit reduces the tax to zero, 40% of any remaining amount of the credit (up to $1,000) is refundable.

To claim the AOTC, the student must be pursuing a degree or other recognized education credential, be enrolled at least half-time for at least one academic period beginning in the tax year and not have completed the first four years of higher education at the beginning of the tax year. Additionally, the credit can be claimed for a maximum of four tax years per eligible student.

The person who claims the student as a dependent on their tax return is generally the one who can claim the AOTC for that student. Most often this will be the parent(s) of the student. However, if the student is not claimed as a dependent, they can claim the credit on their own tax return.

There is another type of higher education credit called the Lifetime Learning Credit (LLC). Since students in their first four years of college will virtually all qualify for the larger AOTC, this article does not discuss the LLC.

When calculating education tax credits, qualified tuition must be reduced by any tax-free scholarship amounts. However, if the scholarship terms allow, students can allocate funds to maximize tax benefits by choosing how to apply the scholarship to different expenses.

Student Loan Interest Deduction

The student loan interest deduction allows borrowers to deduct up to $2,500 of interest paid on qualified student loans from their taxable income each year. This deduction is considered an above-the-line deduction, meaning it can be claimed regardless of whether the taxpayer itemizes deductions or takes the standard deduction.

• Qualified Student Loans: The loan must be used solely for qualified higher-education expenses, which include tuition, fees, room and board, books, equipment, and other necessary expenses related to attending an eligible educational institution.

Eligible loans can include federal student loans, private loans, home equity lines of credit, personal loans from unrelated parties, and even credit cards, provided they are used exclusively for education expenses.

Loans from relatives or pension plans do not qualify.

• Eligibility for Deduction: The borrower must be legally responsible for the loan and must have used the loan for qualified education expenses.

The deduction is phased out for higher-income taxpayers. For single filers, the phase-out range for 2025 is an Adjusted Gross Income (AGI) of $85,000 to $100,000. For married couples filing jointly, the range is $170,000 to $200,000.

The deduction is not available for those who file as married filing separately or for an individual who is claimed as dependents on another taxpayer’s return.

• Additional Requirements:

The student must be enrolled at least half-time in a degree or certificate program at an eligible educational institution.

The loan must be used within a reasonable time frame, typically defined as within 180 days of the start of the academic period for which the expenses are incurred.

State Tax Considerations

State tax laws can vary significantly, impacting student-athletes differently depending on where they attend school and where they earn income:

• State Income Taxes: Some states have no income tax, while others have high rates. Athletes must file state tax returns in states where they earn income, which may include their home state and the state where their college is located, depending on the filing threshold set by each state.
• NIL-Specific Legislation: Several states have enacted NIL-specific legislation, which may include tax provisions. Athletes should be aware of these laws and how they affect their tax obligations.

Planning and Compliance

Effective tax planning and compliance are essential for student-athletes to avoid penalties and maximize their financial benefits:

• Record Keeping: Maintaining detailed records of all income, expenses, and scholarships is crucial for accurate tax reporting.
• Professional Advice: Consulting with a tax professional who understands the unique circumstances of student-athletes can help navigate complex tax issues.
• Education and Resources: Universities and athletic departments can provide resources and education to help athletes understand their tax responsibilities.

The financial landscape for student-athletes is evolving rapidly, with NIL income opportunities adding new dimensions to their tax obligations.

Understanding how the various tax implications of education benefits impact students and parents can lead to more beneficial use of the various tax benefits. Contact our office for assistance.

The “Where’s My Refund” tool is accessible via the IRS website and the IRS2Go mobile app. It provides personalized refund information based on the processing of your tax return. To use the tool, you need to provide your Social Security number, filing status, and the exact whole dollar amount of your expected refund. This information allows the IRS to locate your return and provide an update on its status.

• How to Use the Tool:
  • Access the Tool: Visit the IRS website or download the IRS2Go app on your mobile device.
  • For amended returns, visit: Where’s My Amended Return.
  • Enter Required Information: Input your Social Security number, filing status, and the exact refund amount from line 35a of your Form 1040.
  • Check Status: The tool will display your refund status, which progresses through three stages:
    • Return Received,
    • Refund Approved, and
    • Refund Sent.
    • Update Frequency: The tool is updated once every 24 hours, typically overnight, so there is no need to check more frequently than that.

If you e-file your return, you can usually see your refund status after about 48 hours with Where’s My Refund? You can get your refund information for the current year and past 2 years.

• The Role of Your Social Security Number – Your Social Security number is a critical piece of information when using the “Where’s My Refund?” tool. It serves as a unique identifier that allows the IRS to match your inquiry with your tax return. Ensuring the accuracy of this number is vital to avoid delays or errors in accessing your refund status.
• Expected Timelines for Refunds – The IRS issues more than 90% of refunds in less than 21 days for e-filed returns. However, the timeline can vary based on several factors, including the method of filing and any additional reviews required.

• • Up to 21 days for an e-filed return.
  • Allow 4 weeks or more for returns sent by mail.
  • Generally, allow 8 to 12 weeks for an amended return (Form 1040-X) to be processed. However, in some cases, processing could take up to 16 weeks.
  • Longer if your return needs corrections or extra review.

• EITC and ACTC Delays and Restrictions – Taxpayers claiming the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) should be aware of specific delays and restrictions. By law, the IRS cannot issue refunds before mid-February for returns that claim these credits. This delay is designed to help the IRS prevent fraudulent claims and ensure that refunds are issued accurately.

The delay allows the IRS additional time to verify income and withholding information reported on returns claiming these credits. This verification process helps reduce errors and fraudulent claims, protecting both taxpayers and the integrity of the tax system.

• Caution: Potential Delays Beyond 21 Days – While the IRS processes most e-filed returns within 21 days, some returns may require additional review, leading to delays. Factors that can contribute to longer processing times include:
• Errors or Incomplete Information: Mistakes on your tax return can slow down processing.
• Identity Verification: If the IRS needs to verify your identity, it may take longer to process your return.
• Complex Returns: Returns with multiple forms or unusual circumstances may require more time to review.
• E-File vs. Paper Filing:
• E-File: Electronic filing is the fastest way to submit your tax return and receive your refund. The IRS processes e-filed returns more quickly, often within 21 days.
• Paper Filing: Mailing a paper return can significantly delay the processing time. It may take up to six weeks for the IRS to receive and begin processing a paper return.
• Direct Deposit Option – You can have your refund electronically deposited at no cost into your financial account through the IRS Direct Deposit program. This is a reliable, fast and secure method of getting your refund. You’ll receive your refund quicker than if IRS mails you a check, and you eliminate the possibility of the check being lost or stolen. Direct deposit can be used whether you file electronically or by paper. You even have the option of splitting the refund into up to three accounts. For more information about Direct Deposit, see Get your refund faster: Tell IRS to direct deposit your refund to one, two, or three accounts | Internal Revenue Service

The IRS “Where’s My Refund?” tool is a valuable resource for taxpayers seeking to track their refund status. By understanding how to use the tool and the potential for delays, you can navigate the refund process with confidence.  Remember, while most refunds are processed quickly, patience may be necessary if your return requires additional review.

If you have questions, please contact our office.