For many people in Georgia, qualified retirement plans like 401(k)s and IRAs are important not only because they enable retirement savings but also because they support tax benefits over the years. Many receive distributions from their plans, whether loans from a program or payments after retirement, through electronic methods like direct deposit. In these cases, people do not need to worry about depositing the check or potentially losing or forgetting it. However, the IRS has ruled on the tax issues that arise when people receive paper checks and fail to cash them. To the extent that people continue to rely on paper checks, uncashed checks can present a significant tax question, especially when the amounts involved are substantial.
2018 penalties waived for some paying taxes late
Taxpayers in Georgia may be relieved to learn that they could be exempt from a certain penalty imposed on filers. Each year, people must generally pay at least 90% of their total tax burden prior to filing their returns. If they do not, they will receive an additional fee as an underpayment penalty from the IRS. However, for 2018 returns, those who paid at least 80% of their burden prior to filing will automatically have the penalty waived. The IRS noted that a special penalty waiver was available in the spring, but many eligible taxpayers failed to claim it in time.
What determines your “Taxable Estate” after you pass away?
If you are thinking about creating your will and perhaps other documents in an estate plan, one of your questions will likely be about taxes and how they will affect the assets you want to leave to your heirs.
The difference between a tax opinion and tax ruling
Taxpayers in Georgia and around the country may find that they need guidance from the IRS to answer a question about their return. The IRS may be willing to issue a private letter ruling, and generally speaking, any guidance provided by the ruling is binding. Alternatively, the government may offer to issue a tax opinion, which is generally not binding. However, it may be faster to get a tax opinion as opposed to the private letter ruling.
IRS posts update to new postcard 1040 form
Georgia taxpayers will have to fill out a slightly longer 1040 form when they file their 2019 taxes, according to the Internal Revenue Service. The agency has posted a draft of the new form, which updates the postcard-sized return that debuted in 2018, on its website.
Cryptocurrency investors and IRS warning letters
In Georgia and across the U.S., the Internal Revenue Service is currently mailing official letters to thousands of people who invest in cryptocurrencies. The letters issue official warnings for taxpayers with complex tax issues. The IRS plans to mail letters to approximately 10,000 United States taxpayers. A person who may have failed to pay their taxes on cryptocurrency sales may receive form letter 6173, 6174 or 6174-A.
