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☆ IRS aims to more than double its audit rate for wealthiest taxpayers in strategic plan update
▼ + stars: | 2024-05-02 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

Internal Revenue Commissioner Danny Werfel speaks during his swearing in ceremony at the IRS in Washington, D.C., on April 4, 2023. The agency also renewed its focus on "tax fairness" with plans to increase audits on the wealthiest taxpayers, large corporations and complex partnerships. The IRS aims to more than double the audit rate for the wealthiest taxpayers with total positive income of more than $10 million by tax year 2026. This would bring the audit rate for these individuals to 16.5% in 2026, compared to 11% in 2019. The agency also plans to "nearly triple audit rates" on large corporations with assets over $250 million and boost audit rates "by tenfold" for large, complex partnerships with assets over $10 million, Werfel said.

Persons: Danny Werfel, Werfel Organizations: Washington , D.C, IRS, Finance, Fed Locations: Washington ,

☆ Over $1 billion in unclaimed tax refunds is set to expire in just over 2 weeks, IRS says—here’s how to claim yours
▼ + stars: | 2024-04-30 | by ( Cheyenne Devon | ) www.cnbc.com time to read: +1 min

The Internal Revenue Service says more than $1 billion in unclaimed tax refunds from the 2020 tax year is sitting in its coffers. Around 940,000 people across the U.S. have until May 17 to submit their 2020 tax returns and claim their portion of the unclaimed funds, according to the IRS. "There's money remaining on the table for hundreds of thousands of people who haven't filed 2020 tax returns," IRS Commissioner Danny Werfel said in March. Typically, tax filers have three years to claim old refunds by the April 15 tax filing deadline. The IRS says that your refund may be withheld if you haven't filed your 2021 and 2022 tax returns.

Persons: haven't, Danny Werfel, Werfel Organizations: Internal Revenue Service, IRS

☆ IRS free tax filing pilot processed more than 140,000 returns, saved consumers $5.6 million in prep fees
▼ + stars: | 2024-04-26 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

IRS Commissioner Danny Werfel testifies during the Senate Finance Committee hearing on the fiscal 2024 IRS budget and the IRS' 2023 filing season, in the Dirksen Building in Washington, D.C., on April 19, 2023. This season, more than 140,000 taxpayers successfully filed returns using IRS Direct File, a free tax filing pilot from the IRS, according to the U.S. Department of the Treasury and the IRS. The program fully opened for certain taxpayers in 12 states in early March and saved filers an estimated $5.6 million in tax preparation fees for federal returns, IRS Commissioner Danny Werfel told reporters on a press call. Direct File surveyed more than 15,000 users and some 90% rated their experience as "excellent," the agencies reported. The IRS plans to release a more detailed report about the Direct File pilot "in the coming days," he added.

Persons: Danny Werfel, Werfel Organizations: Senate, IRS, Washington , D.C, U.S . Department of, Treasury, Finance Locations: Washington ,

☆ Thousands Are Eligible for Tax Refunds From 2020
▼ + stars: | 2024-04-19 | by ( Ann Carrns | ) www.nytimes.com time to read: +1 min

Who wouldn’t grab an income tax refund if they had one coming? About 940,000 people, it turns out — because they haven’t filed returns for the 2020 tax year, even though they may be due money back for that year. But there’s still close to a month left to file and collect the refunds. The Internal Revenue Service estimates that the typical refund for the people in this group is more than $900. “There’s money remaining on the table for hundreds of thousands of people who haven’t filed 2020 tax returns,” the I.R.S.

Persons: there’s, “, haven’t, Daniel Werfel, Werfel, Eric Smith Organizations: Internal Revenue Service Locations: Idaho, New York, Pennsylvania

☆ Today is Tax Day for most Americans. Here’s what you need to know
▼ + stars: | 2024-04-15 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +5 min

New York CNN —It’s Tax Day in the United States for most Americans, and there are still plenty of people racing to file their 2023 income tax returns up until the clock strikes midnight. “With the April deadline upon us, we’re seeing a flurry of tax returns coming in during the final hours. So if you’re a last-minute filer, you’re in good company — and even more so if you expect a refund. However, they must pay whatever they still owe the IRS for tax year 2023 by April 15. Do all this even if you relied on a tax program or tax professional to prepare your return.

Persons: We’ve, Danny Werfel, Werfel, don’t, you’re, haven’t, ” Werfel Organizations: New, New York CNN, Patriots, IRS, … Locations: New York, United States, Israel, Massachusetts, Maine, Washington, DC

☆ IRS Commissioner Danny Werfel on Tax Day: We might see millions of returns coming every hour
▼ + stars: | 2024-04-15 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailIRS Commissioner Danny Werfel on Tax Day: We might see millions of returns coming every hourIRS Commissioner Danny Werfel joins CNBC's 'Squawk Box' to explain why the past weekend was busy for him, why Tax Day is important, and more.

Persons: Danny Werfel

☆ IRS expects ‘a million returns' every hour on Tax Day, commissioner says. What last-minute filers need to know
▼ + stars: | 2024-04-15 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

If you're missing tax forms, the tax deadline is your last chance to file an extension, which pushes the filing deadline to Oct. 15. Sean Lovison Founder of Purpose Built Financial ServicesAccording to the IRS, those who can't pay taxes by the deadline have options. Most Americans qualify for IRS Free File, which offers free guided tax prep software from several partners. "It's a product that we're very proud of," Tim Hugo, executive director of the Free File Alliance previously told CNBC. This season, millions of taxpayers also qualify for IRS Direct File, a free tax filing pilot program from the IRS.

Persons: Sean Lovison, Werfel, Tim Hugo Organizations: IRS, Alliance, CNBC, Treasury Locations: filers, Maine, Massachusetts, Philadelphia, Arizona , California, Florida , Massachusetts, Nevada , New Hampshire , New York, South Dakota , Tennessee , Texas, Washington and Wyoming

NEW YORK (AP) — The IRS says it's making progress with initiatives to claw back money improperly distributed under the Employee Retention Credit. The ERC was designed to help businesses retain employees during pandemic-era shutdowns, but it quickly became a magnet for fraud. Its complex eligibility rules allowed scammers to target small businesses, offering help applying for the ERC for a fee — even if they didn't qualify. An ongoing program that lets small businesses withdraw unprocessed claims has led to 1,800 businesses withdrawing $251 million worth of claims. “We remain deeply concerned about widespread abuse involving these claims that have harmed small businesses,” said IRS Commissioner Danny Werfel.

Persons: “, ”, Danny Werfel Organizations: IRS, ERC

The project, known as Direct File and launched by the IRS on a limited basis in 12 states this tax season, is in its pilot phase. Derek Wheeler, director of the Low-Income Taxpayer Clinic at the University of Florida’s Law School, said his clinic has referred less than a dozen clients to the Direct File system. His legal clinic has partnered with the IRS and selectively identifies clients who may be eligible to submit their taxes through the program. One of their biggest criticisms is that free tax prep services already exist for people of all income brackets and developing the Direct File system will end up costing taxpayers billions of dollars. But after using Direct File, she said, “I feel foolish for paying all that money every year.”

Persons: Dixie Warden, ” Warden, Warden, She's, ”, Obama, Derek Wheeler, Wheeler, Grover Norquist, Joe Biden, ‘, Norquist, Daniel Werfel, Vanessa Williamson, ” Wheeler, she’ll, “ Organizations: WASHINGTON, IRS, Affordable, University of Florida’s Law, Associated Press, Tax, Urban, Brookings Tax Policy, Organization for Economic Cooperation, Development, University of Florida, House Republicans, Congress Locations: Kyle , Texas, Florida, New Hampshire , Nevada , South Dakota , Tennessee , Texas, Washington , Wyoming , Arizona , Massachusetts, California, New York, United States, Germany, Japan, Britain, U.S

☆ IRS targets wealthy ‘non-filers’ with new wave of compliance letters
▼ + stars: | 2024-02-29 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

The IRS has unveiled plans to target "non-filers" with a new round of letters, starting with high-income taxpayers who haven't filed federal returns since 2017. Starting this week, the agency will send letters to wealthy non-filers, with the first batch going to those earning $400,000 to more than $1 million. Formerly known as CP-59 notices, the letters will go to between 20,000 and 40,000 non-filers per week, according to plans announced Thursday. The IRS said recipients should take "immediate action" to avoid more letters, higher penalties and "stronger enforcement measures." The agency urges non-filers to work with a tax professional to file past-due returns and calculate taxes owed, penalties and interest.

Persons: haven't, hasn't, Danny Werfel, There's Organizations: IRS, Finance, Fidelity

☆ IRS Commissioner Danny Werfel on taxing the wealthy, restoring fairness and utilizing AI
▼ + stars: | 2024-02-22 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailIRS Commissioner Danny Werfel on taxing the wealthy, restoring fairness and utilizing AICNBC's Robert Frank sits down for a wide-ranging interview with IRS Commissioner Danny Werfel, discussing tax on the wealthy, corporate jet audits, AI, and more.

Persons: Danny Werfel, Robert Frank

☆ Tax evasion by millionaires and billionaires tops $150 billion a year, says IRS chief
▼ + stars: | 2024-02-22 | by ( Robert Frank | ) www.cnbc.com time to read: +3 min

The IRS, with billion of dollars in new funding from Congress, has launched a sweeping crackdown on wealthy taxpayers, partnerships and large companies. The Inflation Reduction Act gave the IRS an $80 billion infusion, yet congressional Republicans won a deal last year to take $20 billion of the funding back. The Treasury Department said last week it estimates greater IRS enforcement to result in an additional $561 billion in tax revenue between 2024 and 2034 — a higher projection than it had initially stated. The IRS is touting its early success with a program to collect unpaid taxes from millionaires. So far, the IRS has collected more than $480 billion from the group, "and we are still going," Werfel said.

Persons: Danny Werfel, Werfel, Ting Shen Organizations: Internal Revenue Service, IRS, CNBC, Congress, Republicans, Treasury Department, Bloomberg, Getty Locations: Washington , DC

☆ IRS Commissioner Werfel: Millionaires and billionaires evade more than $150 billion a year in taxes
▼ + stars: | 2024-02-22 | by ( Robert Frank | ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailIRS Commissioner Werfel: Millionaires and billionaires evade more than $150 billion a year in taxesCNBC's Robert Frank reports on a recent crackdown from the IRS.

Persons: Robert Frank Organizations: Millionaires

☆ IRS zeroes in on corporate jet usage as it cracks down on wealthy tax cheats
▼ + stars: | 2024-02-21 | by ( Katie Lobosco | ) edition.cnn.com time to read: +4 min

“The IRS is using advanced analytics and resources from the Inflation Reduction Act to more closely examine this area,” IRS Commissioner Danny Werfel said on a call with reporters. So far, the IRS has used Inflation Reduction Act funds to help collect more than $482 million from 1,600 millionaires who had not paid their tax debts. Last month, to coincide with the start of tax filing season, the IRS launched its own free, direct tax filing service. How Republicans have targeted IRS fundingThe Inflation Reduction Act, which passed in 2022 without any Republican votes, approved about $80 billion for the IRS over a 10-year period. The House GOP later approved a bill to abolish the IRS altogether and replace the entire federal tax code with a national sales tax.

Persons: Biden, –, Danny Werfel, ” Organizations: Washington CNN, Internal Revenue Service, Democrat, IRS, Republicans, Republican, GOP

☆ I.R.S. to Crack Down on Corporate Jet Users Who Abuse Tax Code
▼ + stars: | 2024-02-21 | by ( Alan Rappeport | ) www.nytimes.com time to read: +1 min

The NewsThe Internal Revenue Service said on Wednesday that it would begin cracking down on corporate jet owners that abused the tax code by claiming millions of dollars in deductions on airplanes that were sometimes being used for personal travel. The scrutiny of corporate jet use will involve new data analytics tools, which the I.R.S. has been developing with the $80 billion in funds it was granted through the Inflation Reduction Act of 2022, to determine when executives or other company officials might be using corporate planes for vacations and private trips. The agency plans to begin dozens of new audits that will focus on large companies, partnerships and wealthy taxpayers. “These aircraft audits will help ensure high-income groups aren’t flying under the radar with their tax responsibilities,” Daniel Werfel, the I.R.S.

Persons: ” Daniel Werfel Organizations: Internal Revenue Service

☆ IRS aims to close 'inequity gap' for unpaid taxes. How the agency targets top earners for audit
▼ + stars: | 2024-02-20 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

IRS Commissioner Daniel Werfel testifies before the Senate Finance Committee on April 19, 2023. The tax gap, or the difference between taxes owed and paid, was an estimated $688 billion for tax year 2021, the IRS reported in October. Instead, profits flow through to the business owners' tax returns. Other 'red flags' for higher earnersIn addition to complex partnerships, the IRS is watching for other "red flags" from higher earners, according to Hylton. Another area of for increased audits could be estate and gift tax returns, particularly those using "aggressive valuation discounts" for assets, Hylton said.

Persons: Daniel Werfel, Chip Somodevilla, Danny Werfel, Werfel, Eric Hylton, Hylton, Colin Walsh, Baker Tilly, Baker Organizations: Senate, IRS, Alliantgroup Locations: U.S, Hylton, Puerto Rico

☆ IRS weighing 'audit selection algorithm' changes for low-income taxpayer credit
▼ + stars: | 2024-02-15 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

Al Drago | Bloomberg | Getty ImagesAfter vowing to "substantially" reduce audits on a low-income tax credit in September, the IRS confirmed it's taking steps to address the inequity. "We also are testing changes in the audit selection algorithm," that could "remediate the disparate impact that has been occurring," he said. The report pointed to a faulty software algorithm used by the agency that selects who gets audited and noted the earned income tax credit contributed to this disparity. The credit has a high 'improper payments rate'In 2022, about 23 million filers received $57 billion from the earned income tax credit, and the tax break averaged $2,541. For tax year 2023, the credit is worth up to $7,430 for a household with three or more children, according to the IRS.

Persons: Danny Werfel, Al Drago, We've, Werfel, Erin Collins Organizations: Washington , D.C, Bloomberg, Getty, IRS, Stanford University, University of Michigan, U.S . Department of, Treasury, University of Chicago, Senate Finance Locations: Washington ,

☆ I.R.S. Commissioner Aims to Show Progress Amid Threats of Budget Cuts
▼ + stars: | 2024-02-14 | by ( Alan Rappeport | ) www.nytimes.com time to read: +1 min

A year later, Mr. Werfel has overseen the clearing of a backlog of thousands of tax filings, shrinking wait times on the I.R.S. telephone lines and the creation of a system that lets qualified taxpayers submit their federal returns with no cost. But those achievements have not been enough to satisfy Republicans, who have accused Mr. Werfel of making the I.R.S. commissioners and when Mr. Werfel testifies before the House Ways and Means Committee on Thursday, he will receive a frosty reception as he fends off efforts to cut his agency’s budget. For Mr. Werfel, the face-off is an opportunity to explain why even skeptics would benefit from a well funded I.R.S.

Persons: Daniel Werfel, Werfel Organizations: Internal Revenue Service

☆ The average tax refund is almost 29% lower this tax season, according to early IRS data
▼ + stars: | 2024-02-12 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

"I caution anyone on reading too much into an entire year, or a tax season of 3½ months, on five days worth of data." Last year, the average refund for the 2023 filing season was $3,167, as of Dec. 29, according to the IRS. A lot of people who typically file early — such as earned income tax recipients and child tax credit recipients — still haven't filed, Steber said. By law, filers claiming the refundable portion of the child tax credit or earned income tax credit won't get refunds until Feb. 27 at the earliest, the IRS says. Why some tax refunds could be biggerTypically, you can expect a refund when you overpay taxes throughout the year.

Persons: Mark Steber, Jackson Hewitt, —, Steber, filers, Danny Werfel Organizations: IRS Locations: Congress

The report comes as access to sensitive taxpayer information has sparked calls for investigations — and calls for reform on taxes for the wealthy. Littlejohn had applied to work as a contractor to get Trump’s tax returns and carefully figured out how to search and extract tax data to avoid triggering suspicions internally, prosecutors said in court documents. Werfel said that since the agency has received funding through Democrats' Inflation Reduction Act, it has been able to markedly improve the security of sensitive information, including audit trail deficiencies. “Our data security and environment is dramatically better today than it was in 2017 to 2020 when this unauthorized access occurred," Werfel said. "And it’s dramatically better today because we now have the resources to make the right investments to strengthen our data security.

Persons: Daniel Werfel —, —, ”, “, TIGTA, Charles Edward Littlejohn of, Donald Trump, Littlejohn, Jason Smith, Werfel, Lindsay Whitehurst Organizations: WASHINGTON, IRS, Treasury, Associated Press, Charles Edward Littlejohn of Washington, Charles Edward Littlejohn of Washington , D.C, New York Times, Associated Locations: Charles Edward Littlejohn of Washington ,

☆ Most Americans can file federal taxes for free — but only about 3% used this option last season
▼ + stars: | 2024-02-05 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

Established in 2002, the program, known as IRS Free File, is a public-private partnership between the agency and the Free File Alliance, a nonprofit coalition of tax software companies. Some 70% of taxpayers — roughly 100 million Americans — are eligible for Free File, according to Tim Hugo, executive director of the Free File Alliance. IRS Free File partners for 2024 season 1040NowDrake (1040.com)ezTaxReturn.comFileYourTaxes.comOn-Line TaxesTaxActTaxHawk (FreeTaxUSA)TaxSlayerIRS Free File is 'not just for simple returns'While complicated filings may need professional guidance, Free File can handle more tax situations than you may expect. Free File partners aren't required to cover all federal income tax forms and schedules. You can also file for an extension through Free File, which moves your filing deadline to Oct. 15.

Persons: there's, Tim Hugo, filers, Danny Werfel, Hugo, 1040Now Drake, There's Organizations: Alliance, IRS

☆ Nearly 1 in 5 eligible taxpayers don't claim this 'valuable credit,' IRS says
▼ + stars: | 2024-02-02 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

Laylabird | E+ | Getty ImagesTens of millions of Americans file tax returns every year — and many are missing a "valuable credit," according to the IRS. In 2022, roughly 23 million filers received $57 billion from the earned income tax credit, or EITC, a tax break for low- to moderate-income workers. But nearly 1 in 5 eligible taxpayers don't claim the EITC, which averaged $2,541 in 2022, IRS Commissioner Danny Werfel told reporters during a press call last week. How the earned income tax credit works"The credit is reasonably complex," said Steven Hamilton, assistant professor of economics at The George Washington University. There's a 'high improper payments rate'"Millions of eligible taxpayers fail to claim the EITC, while other taxpayers claim amounts for which they are not eligible, leading to a high improper payments rate," National Taxpayer Advocate Erin Collins wrote in the 2023 Purple Book of legislative recommendations.

Persons: Danny Werfel, you've, Steven Hamilton, Hamilton, There's, Erin Collins Organizations: The George Washington University, IRS, Center, Black, Stanford University Locations: U.S

☆ Child tax credit could change — but ‘don't wait on Congress’ to file your taxes, IRS commissioner says
▼ + stars: | 2024-01-30 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

Tom Williams | CQ-Roll Call, Inc. | Getty ImagesAs the tax season kicks off, Congress is still negotiating a $78 billion tax package with retroactive changes, including a boost for the child tax credit. If enacted, the child tax credit changes could affect 2023 filings this season. If enacted, the child tax credit changes could expand access, increase the refundable portion of the tax break and add future inflation adjustments. How to handle retroactive child tax credit changesMeanwhile, there are lingering questions from tax professionals about how to handle possible tax law changes for 2023, especially for those who file early. By law, filers claiming the child tax credit or earned income tax credit won't receive refunds until Feb. 27 at the earliest, according to the IRS.

Persons: Danny Werfel, Tom Williams, Jason Smith, Bill Smith, CBIZ, Werfel, filers Organizations: Senate, IRS, Washington , D.C, CQ, Inc, Getty, Urban, Brookings Tax, Republicans, Friday Locations: Washington ,

☆ Tax season kicks off. Here's how to get a faster refund and avoid ‘self-inflicted mistakes,’ expert says
▼ + stars: | 2024-01-29 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

Often, "self-inflicted mistakes" cause refund delays, according to Mark Steber, chief tax information officer at Jackson Hewitt. The IRS is planning for more than 146 million individual tax returns this season, and the deadline for most filers is April 15. Don't 'guesstimate' on your taxesTax return mistakes are another reason for delayed refunds. Some common tax return errors are "surprisingly simple," such as missing or inaccurate Social Security numbers, misspelled names, entering information wrong and math mistakes, according to the IRS. When to expect your tax refund

Persons: Mark Steber, Jackson Hewitt, Danny Werfel, Steber Organizations: IRS

The Direct File pilot program is rolling out in stages. The agency estimates that several hundred thousand taxpayers are eligible for the initial rollout in the 2024 tax season. Four other states that have a state income tax also are part of the pilot program — Arizona, Massachusetts, California and New York. In those four, state tax agencies will help people directly file their state taxes as well. “Direct File is one step toward getting the IRS in line with 21st century tax administration,” Olson said.

Persons: “, Danny Werfel, Nina Olson, ” Olson, Werfel, Tania Mercado, ” Robert Nassau, preparers, ” Organizations: WASHINGTON, IRS, Center for Taxpayer Rights, Organization for Economic Cooperation, Development, Republicans, Intuit, Low, Clinic, Syracuse University College of Law Locations: Florida , New Hampshire , Nevada , South Dakota , Tennessee , Texas, Washington, Wyoming, Arizona , Massachusetts, California, New York, Germany, Japan

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