Affinity Tax Resolution Experts

11/11/2024

IRS Issues Warning About Hurricane Relief Charity Scams
Natural disasters like Hurricanes Helene and Milton bring out the best in American generosity, as millions of people seek to help those affected by the storms. Unfortunately, these tragedies also attract scammers attempting to steal the money and identities of people who wish to donate to relief efforts.

If you get a phone call, text message or email from someone claiming to represent a hurricane relief charity, verify the legitimacy of the organization before providing any personal information. Request the organization’s official name, mailing address and website address, and keep in mind that scammers often use fake organization names that sound similar to real charities.

You can use the IRS Tax Exempt Organization Search tool (TEOS, link below) to verify that you are dealing with an authentic charity, authorized to receive tax-deductible donations. If you cannot find the organization in the database, or if the person who contacted you refuses to answer your questions, do not donate or share sensitive information like your Social Security number (SSN) or credit card number. Instead, hang up immediately or delete the message.

Remember also that legitimate charities will not use high-pressure tactics to push you into donating immediately. They will happily accept your contribution whenever you feel comfortable making it. In addition, trustworthy charitable organizations accept multiple forms of payment, including mailed checks and credit cards. By contrast, scammers often request payments in specific, unusual formats like wire transfers or gift card numbers.

11/05/2024

MSRP Limitations Apply for the Clean Vehicle Credit
For the first time in 2024, people who qualify for the Clean Vehicle Credit (CVC) may transfer the credit to a registered dealership as a down payment, or in exchange for a discounted vehicle price. Vehicles eligible for the credit include many fully electric, plug-in hybrid and fuel cell vehicles assembled in North America. To qualify for the credit, a new vehicle must have a manufacturer’s (MSRP) not exceeding $80,000 for vans, pickups and SUVs, or $55,000 for all other passenger cars. Note that this restriction is based solely on MSRP, not on the price a buyer actually pays for the vehicle.

The IRS recently reclassified some cars as SUVs, making them eligible for the CVC due to the higher MSRP limit. If you recently purchased an electric or plug-in hybrid car but could not claim and/or transfer the CVC due to the MSRP, you can search the current list of eligible vehicles (link below) to see if your car now qualifies for the CVC. If so, you may be able to claim the credit on your 2024 tax return by obtaining a vehicle eligibility report from the dealer.

10/08/2024

October 15 Is the Deadline to File Under a 6-month Extension
With the exception of those eligible for tax deadline relief due to a federally declared disaster, everyone who requested a 6-month extension to file a 2023 tax return must file by October 15. The IRS urges all extension filers to assemble the documents and information they need to fill out their returns now, so they can complete the filing process by the deadline.

If you have a tax refund coming, the sooner you file, the sooner you will have that money in hand. By filing electronically and requesting direct deposit, you could speed up the process by an additional several weeks or more.

On the other hand, if you owe tax, remember that the automatic 6-month extension applies only to filing your return, not to paying tax. Generally, after the standard April filing deadline, unpaid tax balances begin accumulating interest charges that increase daily. To minimize those charges, submit your return with payment promptly. Anyone who cannot pay their tax balance in full by October 15 should still file as soon as possible.

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

10/03/2024

A Late Summer Tax Checkup Helps Prevent IRS Surprises
Every year, many Americans face the disappointment of an unexpectedly large tax bill in the spring. Often, those bills occur because people did not adequately plan for the tax impacts of their activities the previous summer. A late summer or early fall tax checkup can help you stay up to date with your payments, protecting you from disheartening April surprises.

Here are some key questions to consider when reviewing your tax situation:

Did you take on a seasonal or part-time job for the summer?
Did you earn summer income as a gig worker, freelancer or independent contractor?
Did you receive other income not subject to tax withholding, such as interest or dividends?
Did you sell valuable assets like antiques, cryptocurrency, artwork, jewelry, collectibles, stocks or musical instruments at a gain?
Did your tax filing status change (for example, because you got married)?
Any of these circumstances could result in your regular paycheck withholding being insufficient to cover your tax obligations, triggering an IRS penalty in the spring. You can use the IRS Withholding Estimator tool (link below) to check whether your payments are staying on track. If not, you may need to submit a new Form W-4 to your employer to request extra withholding, or make quarterly estimated tax payments.

10/03/2024