It is halfway through February 2025 and the rumor mill when it comes to U.S. taxes is churning faster than ever this year. So we’re here to bust two of the biggest myths we’re hearing this tax season and discuss what is actually true.
Myth #1: IRS e-filing system is closed / deleted / manipulated
The first myth that we’re hearing is that the e-filing system for 2024 is closed or that it’s been in some way deleted or manipulated.
And that’s actually not true.
There are rumors that there are changes at the IRS due to the uncertainty within the U.S. government, and while we don’t know exactly what is going on, what we do know is that the e-filing system is up and running, and both professional tax softwares as well as the IRS direct e-file program are still working properly.
Standard e-filing procedures remain intact, so you do need to file your taxes and pay your taxes on time. There should be no problem using either a professional who uses professional software or the direct e-file to file your taxes.
Remember to e-file to get the fastest refund.
Myth #2: Congressman LaHood’s residence-based taxation bill means Americans abroad no longer need to file U.S. taxes
The second myth that we’re hearing is that Congressman LaHood’s proposed residence-based taxation bill means that Americans abroad either don’t need to file or very soon won’t need to file.
While there is a lot of excitement about Congressman LaHood’s legislation, it has not passed. It actually hasn’t even been proposed in this current congress.
This bill does have a lot of information in it which leads us to believe that if it passes in its current form, there could be a world in which expats no longer need to file U.S. taxes. But it still has a lot of hoops to jump through.
It would first have to be proposed in Congress and go through a number of budget considerations. It could be changed; the language could be altered. Then it needs to pass the House of Representatives before being passed on to the Senate who could potentially also alter the language. Eventually it would need to be signed by a president.
None of that has happened yet, so we’ll see where this bill takes us in the future.
Right now there is no tax relief for Americans living abroad and expats do need to continue filing their U.S. taxes.
Truth #1: You can still get a stimulus payment from 2021
The last thing that we’re hearing is that you can still get a stimulus payment, and that is actually true!
Until April 15th 2025, you can file your 2021 tax return and receive the stimulus from 2021.
If you have not yet filed a 2021 tax return and have not received the stimulus payment that went out, this is your last chance to get it.
You will have to file a tax return in order to get the stimulus.
The third stimulus payment is pretty significant because it was up to fourteen hundred dollars per person or twenty eight hundred dollars for married filing joint.
You can get also the fourteen hundred dollars for your qualifying dependents from 2021.
If you do need to still file a 2021 return and want to claim that stimulus payment, you have until April 15th 2025.
We hope this helps you understand what you can and cannot do in the 2024 tax filing season. Let us know if you have any questions. You can always book a consultation at www.bnctax.com/appointment