REC Accounting & Tax

01/13/2026

Just an FYI. If you had overtime wages in 2025 be sure to keep a copy of your last paystub for 2025 which should have the OT wages listed. There is no place on the W2 to list it. You will need it to give to your tax preparer in order to get credit for it.

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12/30/2025

As we approach another year end and the beginning of another tax season here are a few tips to consider.

If you are making charity contributions and want them credited for 2025 please see that the organization has them by December 31 or that they are postmarked by December 31. Also if you need to make a contribution to an IRA or 401k you do have until April 15, 2026 to have it count for 2025. If made after December 31 you will need to designate which year it is for. If you are self-employed and required to make estimated payments the 4th QT Estimated payment is due by January 15, 2026.

There are sever changes as a result of the OBBB passed by congress in July. There is no tax on overtime or tips also there is an extra $ 6,000 deduction for seniors toward their social security income.

If you live in PA there is a major change to the state income tax filing as well. If you qualify for the EIC on the federal return you will be eligible for a similar credit on the PA State return.

If you are looking for a tax preparer please reach out to me as we are accepting new clients. We also prepare the PA property tax and rent rebates for seniors.

Have a wonderful new year.

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03/12/2025

Tax Time Guide: Use IRS electronic payment options for fast, safe service; avoid penalties and interest



WASHINGTON ― The Internal Revenue Service today encouraged taxpayers to file a tax return or pay taxes they owe using electronic options on IRS.gov by April 15. These digital tools can help taxpayers avoid owing late filing and interest fees.



This announcement is part of the Tax Time Guide, a resource to help taxpayers file an accurate tax return.



File for a filing extension with IRS Free File

All taxpayers – regardless of income – can use IRS Free File to electronically file a six-month extension of time to file before April 15, 2025. There is no income limit for filing Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, through IRS Free File.



An extension gives taxpayers until Oct. 15, 2025, to file and helps them avoid penalties and interest for failing to file on time. An extension of time to file is not an extension of time to pay. Taxpayers must pay what they owe by the April 15 deadline, regardless of any extension to file a return not related to disaster relief. Interest and a late payment penalty will apply to any payments made after April 15. Making a timely payment, even a partial payment, will help limit those penalty and interest charges.



There are multiple options for electronic payments and for entering into a payment plan or an agreement with the IRS.



IRS Online Account

An IRS Online Account gives taxpayers access to important information that they may need when preparing to file a tax return, pay a balance or follow up on notices. That information includes their:

Adjusted Gross Income.
Payment history and any scheduled or pending payments.
Payment plan details.
Digital copies of select notices from the IRS.
Taxpayers can also use their Online Account to securely make a same-day payment for an outstanding 2024 tax balance, pay quarterly estimated taxes for the 2025 tax season or request an extension to file a 2024 return.



Other electronic payment options

Direct Pay, available at IRS.gov, is the fastest, easiest way to make a one-time payment without signing into an IRS Online Account.

Direct Pay is free and allows taxpayers to securely pay their taxes directly from their checking or savings account without any fees or registration. Taxpayers can schedule payments up to 365 days in advance. After submitting a payment through Direct Pay, taxpayers will receive immediate confirmation.
IRS2Go mobile app is the official mobile app of the IRS. Taxpayers can check their refund status, make a payment, find free tax preparation assistance, sign up for helpful tax tips and more. IRS2Go is available in both English and Spanish.
Electronic Funds Withdrawal (EFW) is a free option that allows taxpayers to file and pay electronically from their bank account when using tax preparation software or a tax professional. This option is free and available only when electronically filing a tax return.
Electronic Federal Tax Payment System is a free service that gives taxpayers a safe, convenient way to pay individual and business taxes by phone or online. To enroll and for more information, taxpayers can call 800-555-4477 or visit gov.
Debit or credit card and digital wallet lets individuals pay online, by phone or with a mobile device through any IRS authorized payment processor. Processors charge a fee for their services. The IRS doesn’t receive any fees for these payments. Authorized card processors and phone numbers are available at Make a Payment.
Help for taxpayers who cannot pay in full

The IRS encourages taxpayers who cannot pay in full to pay what they can and consider the variety of payment options available for the remaining balance, including getting a loan to pay the amount due. In many cases, loan costs may be lower than the combination of interest and penalties that the IRS must charge under federal law.



Taxpayers should act as quickly as possible and are urged not to wait to respond to a notice. Tax bills accumulate more interest and fees the longer they remain unpaid. For all payment options, visit Make a Payment.



Online self-service payment plans

Most individual taxpayers qualify for a payment plan and can use the IRS Online Payment Agreement to set up a payment plan to pay off an outstanding balance over time.



Once the online application is complete, the taxpayer receives immediate notification of whether their payment plan has been approved. Taxpayers can set up a plan using the Online Payment Agreement in a matter of minutes.



There’s no paperwork and no need to call, write or visit the IRS. Setup fees may apply for some types of plans.



Online payment plan options for individual taxpayers include:

Short-term payment plan – The total balance owed is less than $100,000 in combined tax, penalties and interest. Additional time of up to 180 days to pay the balance in full.
Simple payment plan - Criteria expanded for 2025 to make it easier and more accessible when the total balance owed is less than $50,000 in combined tax, penalties and interest. Taxpayer may pay in monthly payments for up to the collection statute (usually 10 years), in most cases. Payments may be set up using direct debit (automatic bank withdraw) which eliminates the need to send in a payment each month, saving postage costs and reducing the chance of default. Taxpayers should remember that extending the time to pay will increase the applicable penalties and fees.
Qualified taxpayers with existing payment plans may also be able to use the Online Payment Agreement to make changes including revising their payment dates, payment amounts or bank information for payments made by direct debit. Go to Online Payment Agreement for more information.



Though interest and late-payment penalties continue to accrue on any unpaid taxes after April 15, the failure to pay tax penalty rate is cut in half while an installment agreement is in effect. Find more information about the costs of payment plans on IRS.gov at Additional Information on Payment Plans webpage.



Other payment options

Taxpayers struggling to meet their tax obligation may also consider these additional payment options:

Offer in compromise – Certain taxpayers qualify to settle their tax liabilities for less than the total amount they owe by submitting an offer in compromise. To help determine their eligibility, they can use the Offer in Compromise Pre-Qualifier tool.
Temporary delay of collection – Taxpayers can contact the IRS to request a temporary delay of the collection process. If the IRS determines a taxpayer is unable to pay, it may delay collection until the taxpayer’s financial condition improves. Penalties and interest continue to accrue until the full amount is paid.
Other payment plan options – Taxpayers who do not qualify for online self-service should contact the IRS using the phone number or address on their most recent notice for other payment plan options. For individuals and out-of-business sole proprietors who are already working with IRS Campus Collection and who owe $250,000 or less, one available option is to propose a monthly payment that will pay the balance over the length of the collection statute (usually 10 years). These payment plans don’t require a financial statement, but they do require a determination for the filing of a Notice of Federal Tax Lien.
For more information about payments, see Topic No. 202, Tax Payment Options, on IRS.gov.



Non-digital payment options

Cash: For taxpayers who prefer to pay in cash, the IRS offers a way to pay taxes at one of its many retail partners. The IRS urges taxpayers choosing this option to start early because it involves a four-step process. Details, including answers to frequently asked questions, are at Pay with Cash at a Retail Partner.
Check or money order: Payments made by check or money order should be made payable to the “United States Treasury.” To make sure the payment gets credited promptly, taxpayers should also enclose a 2024 Form 1040-V, Payment Voucher for Individuals, and print the following on the front of the check or money order:
“2024 Form 1040.”
Name.
Address.
Daytime phone number.
Social Security number.
Taxpayer rights

The IRS reminds taxpayers that they have rights and protections throughout the collection process. For details, see Taxpayer Bill of Rights and Publication 1, Your Rights as a Taxpayer.



Taxpayers should know before they owe. The IRS encourages all taxpayers to check their withholdings with the IRS Tax Withholding Estimator.



This information is part of the Tax Time Guide series, a resource to help taxpayers file an accurate tax return. Additional information and help are available in Publication 17, Your Federal Income Tax.



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03/12/2025

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Issue Number: IR-2025-32
Inside This Issue
Tax Time Guide: Use IRS electronic payment options for fast, safe service; avoid penalties and interest



WASHINGTON ― The Internal Revenue Service today encouraged taxpayers to file a tax return or pay taxes they owe using electronic options on IRS.gov by April 15. These digital tools can help taxpayers avoid owing late filing and interest fees.



This announcement is part of the Tax Time Guide, a resource to help taxpayers file an accurate tax return.



File for a filing extension with IRS Free File

All taxpayers – regardless of income – can use IRS Free File to electronically file a six-month extension of time to file before April 15, 2025. There is no income limit for filing Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, through IRS Free File.



An extension gives taxpayers until Oct. 15, 2025, to file and helps them avoid penalties and interest for failing to file on time. An extension of time to file is not an extension of time to pay. Taxpayers must pay what they owe by the April 15 deadline, regardless of any extension to file a return not related to disaster relief. Interest and a late payment penalty will apply to any payments made after April 15. Making a timely payment, even a partial payment, will help limit those penalty and interest charges.



There are multiple options for electronic payments and for entering into a payment plan or an agreement with the IRS.



IRS Online Account

An IRS Online Account gives taxpayers access to important information that they may need when preparing to file a tax return, pay a balance or follow up on notices. That information includes their:

Adjusted Gross Income.
Payment history and any scheduled or pending payments.
Payment plan details.
Digital copies of select notices from the IRS.
Taxpayers can also use their Online Account to securely make a same-day payment for an outstanding 2024 tax balance, pay quarterly estimated taxes for the 2025 tax season or request an extension to file a 2024 return.



Other electronic payment options

Direct Pay, available at IRS.gov, is the fastest, easiest way to make a one-time payment without signing into an IRS Online Account.

Direct Pay is free and allows taxpayers to securely pay their taxes directly from their checking or savings account without any fees or registration. Taxpayers can schedule payments up to 365 days in advance. After submitting a payment through Direct Pay, taxpayers will receive immediate confirmation.
IRS2Go mobile app is the official mobile app of the IRS. Taxpayers can check their refund status, make a payment, find free tax preparation assistance, sign up for helpful tax tips and more. IRS2Go is available in both English and Spanish.
Electronic Funds Withdrawal (EFW) is a free option that allows taxpayers to file and pay electronically from their bank account when using tax preparation software or a tax professional. This option is free and available only when electronically filing a tax return.
Electronic Federal Tax Payment System is a free service that gives taxpayers a safe, convenient way to pay individual and business taxes by phone or online. To enroll and for more information, taxpayers can call 800-555-4477 or visit gov.
Debit or credit card and digital wallet lets individuals pay online, by phone or with a mobile device through any IRS authorized payment processor. Processors charge a fee for their services. The IRS doesn’t receive any fees for these payments. Authorized card processors and phone numbers are available at Make a Payment.
Help for taxpayers who cannot pay in full

The IRS encourages taxpayers who cannot pay in full to pay what they can and consider the variety of payment options available for the remaining balance, including getting a loan to pay the amount due. In many cases, loan costs may be lower than the combination of interest and penalties that the IRS must charge under federal law.



Taxpayers should act as quickly as possible and are urged not to wait to respond to a notice. Tax bills accumulate more interest and fees the longer they remain unpaid. For all payment options, visit Make a Payment.



Online self-service payment plans

Most individual taxpayers qualify for a payment plan and can use the IRS Online Payment Agreement to set up a payment plan to pay off an outstanding balance over time.



Once the online application is complete, the taxpayer receives immediate notification of whether their payment plan has been approved. Taxpayers can set up a plan using the Online Payment Agreement in a matter of minutes.



There’s no paperwork and no need to call, write or visit the IRS. Setup fees may apply for some types of plans.



Online payment plan options for individual taxpayers include:

Short-term payment plan – The total balance owed is less than $100,000 in combined tax, penalties and interest. Additional time of up to 180 days to pay the balance in full.
Simple payment plan - Criteria expanded for 2025 to make it easier and more accessible when the total balance owed is less than $50,000 in combined tax, penalties and interest. Taxpayer may pay in monthly payments for up to the collection statute (usually 10 years), in most cases. Payments may be set up using direct debit (automatic bank withdraw) which eliminates the need to send in a payment each month, saving postage costs and reducing the chance of default. Taxpayers should remember that extending the time to pay will increase the applicable penalties and fees.
Qualified taxpayers with existing payment plans may also be able to use the Online Payment Agreement to make changes including revising their payment dates, payment amounts or bank information for payments made by direct debit. Go to Online Payment Agreement for more information.



Though interest and late-payment penalties continue to accrue on any unpaid taxes after April 15, the failure to pay tax penalty rate is cut in half while an installment agreement is in effect. Find more information about the costs of payment plans on IRS.gov at Additional Information on Payment Plans webpage.



Other payment options

Taxpayers struggling to meet their tax obligation may also consider these additional payment options:

Offer in compromise – Certain taxpayers qualify to settle their tax liabilities for less than the total amount they owe by submitting an offer in compromise. To help determine their eligibility, they can use the Offer in Compromise Pre-Qualifier tool.
Temporary delay of collection – Taxpayers can contact the IRS to request a temporary delay of the collection process. If the IRS determines a taxpayer is unable to pay, it may delay collection until the taxpayer’s financial condition improves. Penalties and interest continue to accrue until the full amount is paid.
Other payment plan options – Taxpayers who do not qualify for online self-service should contact the IRS using the phone number or address on their most recent notice for other payment plan options. For individuals and out-of-business sole proprietors who are already working with IRS Campus Collection and who owe $250,000 or less, one available option is to propose a monthly payment that will pay the balance over the length of the collection statute (usually 10 years). These payment plans don’t require a financial statement, but they do require a determination for the filing of a Notice of Federal Tax Lien.
For more information about payments, see Topic No. 202, Tax Payment Options, on IRS.gov.



Non-digital payment options

Cash: For taxpayers who prefer to pay in cash, the IRS offers a way to pay taxes at one of its many retail partners. The IRS urges taxpayers choosing this option to start early because it involves a four-step process. Details, including answers to frequently asked questions, are at Pay with Cash at a Retail Partner.
Check or money order: Payments made by check or money order should be made payable to the “United States Treasury.” To make sure the payment gets credited promptly, taxpayers should also enclose a 2024 Form 1040-V, Payment Voucher for Individuals, and print the following on the front of the check or money order:
“2024 Form 1040.”
Name.
Address.
Daytime phone number.
Social Security number.
Taxpayer rights

The IRS reminds taxpayers that they have rights and protections throughout the collection process. For details, see Taxpayer Bill of Rights and Publication 1, Your Rights as a Taxpayer.



Taxpayers should know before they owe. The IRS encourages all taxpayers to check their withholdings with the IRS Tax Withholding Estimator.



This information is part of the Tax Time Guide series, a resource to help taxpayers file an accurate tax return. Additional information and help are available in Publication 17, Your Federal Income Tax.



Back to Top

Send a message to learn more

01/08/2025

ssue Number: Tax Tip 2025-03

Get ready for tax filing season 2025

As tax filing season approaches, the IRS Get Ready campaign reminds taxpayers of simple steps they can take now to get ready to file their 2024 federal tax returns. As the IRS continues its digital transformation, it’s making filing easier for taxpayers by providing new online tools as well as expanding and updating other digital tools.

Access IRS Online Account for helpful information

Taxpayers can create or access their personal IRS Online Account, where they can find all their tax-related information for the 2025 filing season. New users will need to have a photo ID ready to verify their identity.

Through their IRS Online Account, taxpayers can:

View key details from their most recent tax return, such as adjusted gross income.
Request an Identity Protection PIN.
Get account transcripts to include wage and income records.
Sign tax forms such as powers of attorney or tax information authorizations.
View and edit language preferences request and alternative media such as Braille, large print and more.
Receive and view over 200 IRS electronic notices.
View, make and cancel payments.
Set up or change payment plans and check their balance.
Gather and organize tax documents

Having well-organized tax records can make filing a complete and accurate return easier and help avoid errors that can delay refunds. This may also help the taxpayer identify deductions or credits that may have been overlooked.

Most income is taxable, including unemployment compensation, refund interest and income from the gig economy and digital assets. Taxpayers should watch for and gather essential forms, such as Forms W-2, Wage and Tax Statement and other income documents

Helpful IRS resources and online tools

IRS.gov is a valuable resource for taxpayers, offering a variety of online tools such as the IRS Online Account for individuals available 24/7. These tools help individuals file and pay taxes, track refunds, access account information and get answers to many tax questions. Taxpayers can save time by bookmarking these resources on their browser for easy access.

More Information

How to File Your Taxes: Step by Step
IRS Encourages Taxpayers to Prepare for 2025 Filing Season with Online Tools and Key Reminders
Get Your Refund Faster: Tell IRS to Direct Deposit Your Refund to One, Two, or Three Accounts
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04/17/2024

ssue Number: IR-2024-113
Inside This Issue
IRS updates frequently asked questions for the energy efficient home improvement and residential clean energy property credits



WASHINGTON — The Internal Revenue Service today updated frequently asked questions in Fact Sheet 2024-15 to addresses the federal income tax treatment of amounts paid for the purchase of energy efficient property and improvements.



These FAQs supersede earlier FAQs that were posted in Fact Sheet 2022-40, on Dec. 22, 2022.



The FAQs revisions are as follows:

General questions— Question 4
On April 5, 2024, the Internal Revenue Service issued Announcement 2024-19 that addressed the federal income tax treatment of amounts paid for the purchase of energy efficient property and improvements.



Generally, taxpayers who receive rebates for the purchase of energy efficient homes will not include the value of those rebates as income on their tax returns, however they will need to reduce the basis of the property when they sell it by the amount of the rebate.



The Inflation Reduction Act (IRA) statutory language describes performance-based incentives and electrification product subsidies as “rebates.”



Announcement 2024-19 provides that amounts received from the Department of Energy (DOE) home energy rebate programs funded through the IRA will be treated as a reduction in the purchase price or cost of property for eligible upgrades and projects. Accordingly, the consumer that receives an IRA rebate will not be required to report the value of the rebate as income.



More information about reliance is available.

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04/17/2024

Debunking common myths about federal tax refunds

Once people complete and file their tax return, many of them eagerly await any refund they may be owed. Knowing fact from fiction can help manage expectations as they wait for their money.

Myth: Calling the IRS, a tax software provider or a tax professional will provide a more accurate refund date.

Fact: The best way to check the status of a refund is through the Where's My Refund? tool or the IRS2Go app.

Taxpayers can also call the automated refund hotline at 800-829-1954 to get their refund status. This hotline has the same information about current tax year refunds as Where's My Refund? There is no need to call the IRS unless Where's My Refund? says to do so.

Myth: The Where's My Refund? tool must be wrong if it hasn’t updated yet.

Fact: Where’s My Refund has the most current information about refund status. It is updated once a day, usually overnight. Even though the IRS issues most refunds within 21 days, it's possible a refund may take longer. If the IRS needs more information to process a tax return, the agency will contact the taxpayer by mail. Taxpayers should also consider the time it takes for banks to post the refund to the taxpayer's account. People waiting for a refund in the mail should allow extra time.

Myth: The Where's My Refund? tool must be wrong because the refund amount is less than expected.

Fact: There are several factors that could cause a tax refund to be less than expected. The IRS will mail the taxpayer a letter of explanation if it adjusts a refund. Some taxpayers may also receive a letter from the Department of Treasury's Bureau of the Fiscal Service if their refund was reduced to offset certain financial obligations. Before calling, taxpayers should wait for the letter to understand why the change occurred.

Myth: Getting a refund this year means there's no need to adjust withholding for tax year 2024.

Fact: To avoid a surprise next year, taxpayers should make changes now to their tax withholding. The Tax Withholding Estimator tool can help taxpayers determine if their employer is withholding the right amount. Taxpayers can use the results from the Tax Withholding Estimator to complete a new Form W-4, Employee's Withholding Certificate and submit it to their employer as soon as possible. Withholding takes place throughout the year, so it's better to take this step as soon as possible.

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04/03/2024

Issue Number: IR-2024-91
Inside This Issue
Dirty Dozen: Beware of Offer in Compromise 'mills' that falsely claim their services are necessary to resolve IRS debt

WASHINGTON – As part of the annual Dirty Dozen list of tax scams, the Internal Revenue Service today renewed its warning to taxpayers concerning pricey Offer in Compromise (OIC) "mills” that aggressively mislead taxpayers into thinking their tax debts can disappear.

As in past years, companies running OIC mills continue heavily advertising their promises to settle taxpayer debt at steep discounts for pennies on the dollar. While OIC is a legitimate IRS program, many taxpayers do not meet the technical requirements for the tax resolution program, often leaving them facing excessive fees from the promoters for information they could have easily obtained for free by using the IRS's Offer in Compromise Pre-Qualifier tool.

The OIC is a valuable IRS program to help taxpayers who cannot pay their federal tax debts, and some companies offer legitimate services. But the IRS encourages individuals to take a few minutes to assess the information available on IRS.gov to determine if they meet the eligibility criteria for the OIC program and to avoid hiring expensive promoters.

"Taxpayers need to be cautious with aggressive marketing around the Offer in Compromise program that can mislead taxpayers,” said IRS Commissioner Danny Werfel. “These mills try to pull in steep fees while raising false expectations and exploiting vulnerable individuals with promises that tax debt can magically disappear.”

“The program is legitimate, but it’s not for everyone,” Werfel added. “The IRS wants to help taxpayers who qualify for this program, but there are very specific requirements for people to qualify. A good first step is for taxpayers to take a few minutes and explore our free resources on IRS.gov. They can find out if they might qualify for this program – and at the same time avoid paying someone a hefty fee.”

OIC mills are the focus of the fifth news release in the Dirty Dozen series. Started in 2002, the IRS' annual Dirty Dozen campaign lists 12 scams and schemes that put taxpayers and the tax professional community at risk of losing money, personal information, data and more. While the Dirty Dozen is not a legal document or a formal listing of agency enforcement priorities, the education effort is designed to raise awareness and protect taxpayers and tax pros from common tax scams and schemes.

Beware of Offer in Compromise mills

An OIC is a legitimate IRS program that allows qualifying taxpayers to work with the IRS to settle a tax debt for less than the full amount owed. It is an option for those who may be unable to pay their full tax liability, or if doing so creates a financial hardship. In determining eligibility, the IRS considers the taxpayer’s unique situation. The OIC agreement occurs directly between the taxpayer and the IRS without a third party.

Taxpayers, however, should be cautious of OIC mills, which make exaggerated claims through radio and TV ads about settling tax debts inexpensively. In reality, these mills often charge excessive fees, and taxpayers end up paying for a service they could have obtained for free directly from the IRS.

The IRS urges individuals to spend a few minutes reviewing information on IRS.gov to determine if they may be eligible for the OIC program by using the IRS's Offer in Compromise Pre-Qualifier tool for free.

The IRS also reminds taxpayers about the First Time Penalty Abatement policy, where taxpayers can go directly to the IRS for administrative relief from a penalty that would otherwise be added to their tax debt.

Help others: Report fraud, scams and schemes

The IRS encourages taxpayers to report any individuals promoting improper, abusive or fraudulent tax schemes, as well as tax return preparers who deliberately prepare improper or fraudulent returns.

To report an abusive tax scheme or a tax return preparer, people should use the online Form 14242, Report Suspected Abusive Tax Promotions or Preparers, or mail or fax a completed paper Form 14242, Report Suspected Abusive Tax Promotions or Preparers, and any supporting material to the IRS Lead Development Center in the Office of Promoter Investigations.

Mail:
Internal Revenue Service Lead Development Center
Stop MS5040
24000 Avila Road
Laguna Niguel, California 92677-3405
Fax: 877-477-9135

Additionally, taxpayers and tax practitioners may submit their report of improper or fraudulent practices to the IRS Whistleblower Office, which may offer a possible monetary award.

To learn more about avoiding becoming a victim of tax preparation schemes and fraud, please see Abusive Tax Schemes and Abusive Tax Return Preparers on IRS.gov.

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