Did you receive, sell, exchange or buy any virtual currency? All taxpayers filing Form 1040, Form 1040-SR or Form 1040-NR must check one box answering either “Yes” or “No” to the virtual currency question. The question must be answered by all taxpayers, not just taxpayers who engaged in a transaction involving virtual currency in 2021. Click here for more information.
Tax Breaks for Teachers
Teachers or other educators can deduct the unreimbursed cost of books, supplies, computer equipment, software and COVID-19 protective items used in the classroom. For 2022, they will be able to deduct up to $300 of out-of-pocket classroom expenses when they file their federal income tax return next year. If they are married and file a joint return with another eligible educator, the limit rises to $600. Click here for more information. For those teachers and educators filing their 2021 tax returns due in April, the deduction is limited to $250. The limit will rise in $50 increments in future years based on inflation adjustments.
Need more time to file?
Good news for those who are unable to file their taxes by April 18. Individual tax filers can use IRS Free File to electronically request an automatic tax-filing extension. The fastest and easiest way to get an extension is through IRS Free File on IRS.gov. Taxpayers can also request an extension electronically using Form 4868. Filing this form gives taxpayers until October 17 to file their tax return. To get the extension, taxpayers must estimate their tax liability on this form and should timely pay any amount due. It is important to note here that is not an extension to file not an extension to pay.
What happens if you didn’t receive the economic impact payment?
Taxpayers are reminded to accurately claim any remaining third-round stimulus payment on their 2021 income tax return as the 2021 Recovery Rebate Credit. Click here to read more 2021 Recovery Rebate Credit Questions and Answers.
In-person help on Saturday, April 9
If you should need in-person assistance, Taxpayer Assistance Centers will be open around the country Saturday, April 9. There are four locations open in Florida:
- 850 Trafalgar Ct., Maitland/Orlando, FL 32751
- 51 S.W. First Ave., Miami, FL 33130
- 7850 S.W. Sixth Ct., Plantation/Fort Lauderdale, FL 33324
- 3848 W. Columbus Dr., Tampa, FL 33607
Stay alert to scams
The IRS reminds taxpayers to take steps in securing their computers, tablets and phones. Solid cybersecurity protection and scam recognition is vital to reduce the threat of identity theft inside and outside the tax system. Below are tips to help minimize exposure to fraud and identity theft:
- Safeguard personal data. Provide a Social Security number, for example, only when necessary. Only offer personal information or conduct financial transactions on sites that have been verified as reputable, encrypted websites.
- Protect personal information. Treat personal information like cash – don’t hand it out to just anyone. Social Security numbers, credit card numbers, bank and even utility account numbers can be used to help steal a person’s money or open new accounts.
- Use strong passwords. Use a password phrase or series of words that will be easy for you to remember. Use at least 10 characters; 12 is ideal for most home users. Mix letters, numbers and special characters. Try to be unpredictable – don’t use names, birthdates or common words.
- Set password and encryption protections for wireless networks. If a home or business Wi-Fi is unsecured, it allows any computer within range to access the wireless network and potentially steal information from connected devices. Whenever it is an option for a password-protected account, users should also opt for a multi-factor authentication process. Multi-factor authentication is critical to protecting your password.
- Avoid phishing scams. The easiest way for criminals to steal sensitive data is simply to ask for it. IRS urges people to learn to recognize phishing emails, calls or texts that pose as familiar organizations such as banks, credit card companies or even the IRS. Keep sensitive data safe.
- Pause to click. Be aware that an unsolicited email with a request to download an attachment or click on a URL could appear to come from someone that you know like a friend, work colleague or tax professional if their email has been spoofed or compromised.
- Never download “security” software from a pop-up ad. A pervasive ploy is a pop-up ad that indicates it has detected a virus on the computer. The download most likely will install some type of malware. Reputable security software companies do not advertise in this manner.
- Use security software. An anti-virus program should provide protection from viruses, Trojans, spyware and adware. The IRS urges everyone to use an anti-virus program and always keep it up to date. Set security software to update automatically so it can be updated as threats emerge.
- Back up files. No system is completely secure. Copy important files, including federal and state tax returns, onto removable discs or back-up drives and cloud storage. Store discs, drives and any paper copies in secure, locked locations.
- Know the risk of public Wi-Fi. Connection to public Wi-Fi is convenient and often free, but it may not be safe. Hackers and cybercriminals can easily steal personal information from these networks. Always use a virtual private network when connecting to public Wi-Fi.
Remember, the IRS doesn’t initiate contact with taxpayers by email, text messages or social media channels to request personal or financial information. Generally, the IRS first mails a paper notice to a person who owes taxes. In some special situations, the IRS will call or come to a home or business. People should be alert to scammers posing as the IRS to steal personal information. There are ways to know if it’s really the IRS calling or knocking on someone’s door.
Having knowledgeable advisors to guide you through this process is key. Those needing assistance with tax related issues may reach me at email@example.com or by phone at 239-344-1147. Virtual appointments are available.