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Tax season is in full swing

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The IRS began accepting 2017 federal income tax returns on Jan. 29. The tax agency reports that it is expecting upwards of 155 million returns. More than 70% of them are expected to yield refunds. At least 90% of refunds will be issued within 21 days of receipt of the returns, but refunds that include an earned income tax credit or additional child credit shouldn’t be expected before Feb. 27, 2018. The filing deadline this year is April 17, 2018. Read more at: http://bit.ly/2FvRO3y

How would homeowners fare under the proposed tax law?

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The Tax Cuts and Jobs Act would make several changes. For example, it retains the mortgage interest deduction (subject to a $1 million cap) for mortgages that already exist on Nov. 2, 2017, as well as for those who entered into a binding written contract before that date. However, for newly purchased homes, the deduction would be limited to $500,000 and taxpayers would be limited to one qualified residence. The bill would also retain the property tax deduction, subject to a $10,000 maximum.

Am I more likely to be audited if I extend?

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Extending will NOT increase your likelihood of being audited by the IRS.  It is better to file an extension rather than to file a return that is incomplete or that you have not had time to review carefully before signing.

Dig out first, then file for an extension

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The IRS has granted businesses affected by Winter Storm Stella, the storm that hit parts of the Northeast and Mid-Atlantic this week, additional time to request a 6-month extension to file their 2016 federal tax returns. The extension for the extension affects calendar year partnerships and S corporations that must file their 2016 returns by March 15, or else file for an automatic 6-month extension on Form 7004. The deadline to file an extension is March 20. Eligible taxpayers must write “Winter Storm Stella” on their Form 7004 extension request.