What are the opening hours?

Monday 8am - 5pm Tuesday 8am - 5pm Wednesday 8am - 5pm Thursday 8am - 5pm Friday 8am - 5pm

Jonathan Lucas CPA, 2316 Montana Avenue, El Paso, TX (2026)

05/01/2023

Letters from the IRS - Did You Know?

If the IRS needs to contact a taxpayer, the agency will generally send a letter in the mail rather than emailing or calling. Taxpayers may receive IRS letters for many reasons, including:

- The taxpayer owes tax and did not pay it with their return or set up a payment plan.
- The IRS has a question about a tax return or needs more information to process it.
- The IRS has made an adjustment to a tax return or refund amount.
- The IRS needs to verify a taxpayer's identity.

If you receive an IRS letter in the mail, do not ignore it, but also do not panic. Some IRS notices do not require the taxpayer to take any action, while others advise the taxpayer of an issue that can be readily resolved. In many cases, you will not need to respond to the letter. For example, if an IRS notice simply informs you of a minor change made to your return or your refund amount, you can just file it with your tax records for future reference.

However, if the letter asks you to provide the IRS with additional information, you should respond as quickly as possible. Pay special attention to whether the notice includes a deadline to respond. Taxpayers who fail to reply to an IRS letter by a specified deadline may face penalties or forfeit their appeal rights.

You have the right to appeal any IRS decision about your tax return or the amount of tax you owe. If you do not understand an IRS notice or believe the IRS has made an error, a tax professional can help you figure out the situation and plan your next steps.

04/25/2023

Tax Debt Settlement Scams – Did You Know?

When a taxpayer owes more tax than they can pay without extreme hardship, the IRS sometimes accepts an offer-in-compromise (OIC). Under an OIC agreement, the taxpayer may settle their tax debt for less than the full amount owed.

However, the IRS warns taxpayers to watch out for "OIC mills," agencies that churn out stacks of OIC applications, costing the taxpayers they supposedly represent thousands of dollars. Many of these agencies make unrealistic claims in radio, TV and internet ads about settling tax debts for "pennies on the dollar." Often, a taxpayer gets talked into paying an OIC mill to file an application that the agency knows will be rejected, because the taxpayer does not qualify for the OIC program. Even when the IRS accepts an application from an OIC mill, the excessive fees charged by the agency may still cause the taxpayer great financial harm.

If you are considering an OIC to settle your tax bills, do not believe the hype. You may check your eligibility using the IRS' Offer In Compromise Pre-Qualifier tool with the link below. Working with a trusted tax professional can also determine whether you qualify for the OIC program, as well as help you prepare an application with a better chance of being accepted.

Offer In Compromise Pre-Qualifier tool: https://irs.treasury.gov/oic_pre_qualifier/

04/17/2023

Filing Extensions and Minimizing Penalties – Did You Know?

Taxpayers who request an extension to file their 2022 federal income tax returns may file anytime up until October 16th, 2023. Remember, however, that an IRS extension is only an extension to file tax returns, NOT an extension to pay any tax owed. Taxes not paid by the April 18th payment deadline may be subject to late penalties and interest charges.

Electronic payments may be made using the IRS online payment portal (link below). The IRS urges those who cannot pay what they owe at this time to pay whatever amount they can, and then apply for an installment plan to pay off the remaining balance.

If you are required to file, you should still file your taxes, even if you can't pay, as the failure-to-file penalty may be 10 times more than the failure-to-pay penalty.

IRS Online Payment Portal: https://www.irs.gov/payments

04/12/2023

Reducing Fees & Penalties - Did You Know?

If you are required to file your taxes, you should still file, even if you can't pay, as the failure-to-file penalty may be 10 times more than the failure-to-pay penalty. If you are unable to pay in full, try to file your tax return by the deadline of April 18th, 2023 and pay as much as you can.

In addition, April 18th is also the due date for Tax Year 2023 first quarter estimated tax payments for those making estimated payments.

04/10/2023

Reporting Foreign Income and Assets – Did You Know?

The IRS generally requires taxpayers to report both their income from foreign sources and any assets they hold outside the U.S. (such as a foreign bank account). Foreign income may include earned income like wages, a salary or self-employment earnings, as well as unearned income like interest or dividends. Taxpayers who qualify for the Foreign Earned Income Exclusion or Foreign Tax Credit must still report their income on a U.S. tax return to claim these benefits.

Even if you did not receive any income from foreign sources in 2022, you may still need to report foreign assets like bank and investment accounts on your tax return. In most cases, you must also file an FBAR form (Report of Foreign Bank and Financial Accounts) if the total value of your foreign assets exceeded $10,000 at any point in 2022. The FBAR filing deadline is April 15, 2023, however, if you are unable to meet this deadline, FinCEN offers an automatic extension until Oct. 15, 2023. Note that the FBAR is NOT an IRS form, and cannot be filed with your tax return. Instead, FBAR forms must be submitted separately to the Financial Crimes Enforcement Network (FinCEN).

04/05/2023

IRS Filing Deadline is April 18th – Filers in Disaster Areas May Have Additional Time

The general filing and payment deadline for 2022 federal tax returns is Tuesday, April 18, 2023.

If you live in a region covered by a federal disaster declaration, you may have additional time to file your return and pay any tax due. The IRS has extended the deadline for residents of certain counties in Alabama and Georgia affected by severe storms, along with many areas of California, to October 16, 2023. Arkansas and Mississippi residents affected by the storm may also now have until July 31 to file and pay payments. The IRS disaster relief webpage (link below) lists all counties and regions that have been granted extended deadlines.

IRS Disaster Relief Page: https://www.irs.gov/newsroom/tax-relief-in-disaster-situations

04/03/2023

IRS Online Account Setup Scams – Did You Know?

Each year, the IRS issues a list of the most prevalent scams that put taxpayers' identities and hard-earned money at risk. Some dangerous scams relate to IRS online accounts. Many taxpayers find that setting up an online account helps them stay on top of their taxes and make better planning decisions. Unfortunately, this IRS service has also drawn the attention of digital scammers.

In one common scheme, the scammer contacts a taxpayer, posing as a representative of a supposedly helpful service for people with limited computer skills. The scammer offers to help the taxpayer set up an online IRS account, asking for sensitive information like the taxpayer's address, photo ID, and Social Security number (SSN) or Individual Taxpayer Identification number (ITIN). The scammer then sells this information to criminals, who use it for tax fraud and other forms of identity theft.

The IRS warns taxpayers that ANY such offer is a scam. Most people can readily set up their own IRS online accounts by following the instructions at irs.gov. If you do need help, only seek it from a trusted person, like a family member or tax professional.

IRS Online Account: https://www.irs.gov/payments/your-online-account.

03/29/2023

Tax Refund Myths and Realities – Did You Know? (2/2)

Here are two more key facts you need to know to avoid falling for the myths.

- The refund amount displayed by the Where's My Refund tool could differ from the amount you were expecting. The IRS may need to adjust a taxpayer's refund amount for a variety of reasons, ranging from math errors on their returns to outstanding financial obligations. When such an adjustment is necessary, the IRS always sends a letter explaining the change.

- Getting a 2022 tax refund does not necessarily mean that your 2023 withholding is on track. Regardless of how your 2022 taxes came out, you should check your withholding at least once every year. Tax law changes, along with changes in your marital status, family size or many other factors can affect your withholding. You can use the IRS Withholding Estimator tool (link below) to find out if you need to make any adjustments.

If you have not yet filed your 2022 tax return, a tax professional can help you file it electronically with direct deposit, to ensure that you get your refund as quickly as possible.

IRS Where's My Refund tool: https://www.irs.gov/refunds
IRS Withholding Estimator: https://www.irs.gov/individuals/tax-withholding-estimator

03/27/2023

Tax Refund Myths and Realities – Did You Know? (1/2)

Taxpayers who are owed a 2022 tax refund naturally want to know how quickly that refund will come. Unfortunately, a lot of myths and half-truths about IRS refunds circulate online, giving people false expectations or leading them to waste time on unnecessary steps. Here are two key facts you need to know to avoid falling for the rumors.

- Calling the IRS will generally not yield more information about your refund. You can get the most up-to-date information about your refund status nearly around the clock by using the online Where's My Refund tool (link below) or by calling the automated refund hotline at 800-829-1954.

- The Where's My Refund Tool cannot always give a refund date. Some taxpayers may believe something is wrong if this tool does not display a mailing or deposit date for their refunds. Although the IRS issues many refunds within 21 days, some returns take longer to process. You will get a refund date once the IRS finishes reviewing your return.

If you have not yet filed your 2022 tax return, a tax professional can help you file it electronically with direct deposit, to ensure that you get your refund as quickly as possible.

IRS Where's My Refund tool: https://www.irs.gov/refunds

03/23/2023

IRS Warns Businesses About Employee Retention Credit Scams

The IRS recently issued multiple warnings about scams related to the Employee Retention Credit (ERC). Congress created the ERC in 2020 to help businesses that kept employees in spite of reduced revenues during the pandemic. In most cases, to qualify for the credit, a business must have had significant, pandemic-related revenue decreases in 2020 or the first three quarters of 2021. Some ventures classified by the IRS as “recovery startup businesses” may also claim the credit if they paid employees during the third and/or fourth quarter of 2021.

In radio and internet ads, scammers are making exaggerated claims about the size of the ERC, and often misleading business owners about eligibility rules for the credit. Some scammers offer to file an ERC application on the business owner's behalf, for a fee. However, with IRS staff carefully reviewing all ERC claims, bogus applications will typically be identified and rejected. Taxpayers who file inaccurate returns or improperly claim tax benefits may face IRS as well as legal penalties.

Some other promoters of fake ERC opportunities are engaged in identity theft. These scammers use a bogus application form to harvest a taxpayer's personal identification and tax information, then disappear. The IRS urges business taxpayers to be suspicious of all ads making “too good to be true” claims about the ERC. The safest way to determine whether your business qualified for the ERC in 2020 or 2021, and may still claim it, is to work with a trusted tax professional.

03/21/2023

Common Tax Filing Errors – Did You Know? (3/3)

Every year, many taxpayers may make mistakes on their returns that cause IRS processing delays. Some common errors can also result in paying too much or too little tax.

The following mistakes often cause filers to pay the wrong amount of tax:

Incorrectly Figuring Credits or Deductions:
Once you determine that you qualify for a tax deduction or credit, you must carefully compute the amount that you can claim. Many taxpayers fail to take into account income limitations (including the calculations that must be made if your income falls within a “phase-out” range) and other restrictions. Others claim less than they could, or miss out on deductions and credits entirely by not filing the required forms and schedules.

Expired ITIN:
Those who file their IRS returns using individual tax identification numbers (ITINs) must keep in mind that ITINs periodically expire. Although a return filed with an expired ITIN may be accepted, the IRS generally will not allow any of the exemptions or tax credits claimed. The taxpayer must renew their ITIN in order to obtain the full refund that they are owed.

To avoid costly mistakes, the IRS recommends having a tax professional prepare or check your return and file it electronically. A tax pro might also help you claim deductions and credits that you would otherwise miss.

03/15/2023

Reminder: First Retirement Required Minimum Distributions Deadline

If you reached 72 years of age in 2022 and have an IRA (other than a Roth), or a 401(k) or similar retirement plan, then you likely need to withdraw funds from that account by April 1. In general, taxpayers with these retirement plans must begin taking annual withdrawals, called required minimum distributions (RMDs), once they reach a specified age.

This special April 1 deadline applies only to those taking their FIRST retirement account RMD. The normal deadline for RMDs is December 31 of the year that the RMD applies to. This means that taxpayers who turned 72 in 2022 and take their first RMD by April 1 will generally need to take a second, separate RMD for 2023 by December 31.

The age threshold of 72 for 2022 RMDs generally applies for traditional, SEP and SIMPLE IRAs, as well as for many workplace retirement plans such as 401(k), 403(b) and 457(b) plans. However, if you still work for the organization where you set up your 401(k) or similar plan, you may be able to delay your first RMD until April 1 of the year after you retire. Roth IRAs generally do not have RMDs, unless the account was inherited.

Your retirement account manager can help you figure the amount of your first RMD, and ensure that the transaction is completed by the deadline. In general, RMDs are taxable income.

Jonathan Lucas CPA

05/01/2023

04/25/2023

04/17/2023

04/12/2023

04/10/2023

04/05/2023

04/03/2023

03/29/2023

03/27/2023

03/23/2023

03/21/2023

03/15/2023

Address

Opening Hours

Website

Alerts

Shortcuts

Share

Category

Monday	8am - 5pm
Tuesday	8am - 5pm
Wednesday	8am - 5pm
Thursday	8am - 5pm
Friday	8am - 5pm