Category: Tax Services

Tax season for 2023 has ended for most Americans. However, if you didn’t have your paperwork together, or you couldn’t get your return finished, you had the option to file for a tax extension. That gives you until October 15th to prepare and submit your return. (Note: an extension only applies to the paperwork. If you owe taxes, you were still expected to pay them no later than April 18th.) The good news is that the IRS offers a program that allows most Americans to file their taxes for free without the help of expensive accountants or tax software programs. They call this program “File Free”.

What is Free File?

The IRS Free File program is a service that connects eligible taxpayers with commercial tax preparation software at no charge. Some providers also offer free state tax returns. Per IRS guidelines, this program is available to filers who have an adjusted gross income (AGI) of less than $73,000 for the 2021 tax year. (Your AGI is your total gross income less qualifying deductions, such as the standard deduction, IRA contributions, HSA contributions and business expenses.) The IRS doesn’t have an age limit to use the program, but some tax software providers have more conservative income and age limits. For example, to use the FreeTaxUSA.com product, your AGI cannot be greater than $41,000, and TaxAct.com requires that users be age 56 or younger.

According to the IRS, roughly 70 percent of American taxpayers are eligible to use Free File. However, fewer than five percent of eligible taxpayers in 2020 took advantage of the Free File program. Many of these taxpayers paid for access to tax software or paid accountants to prepare their returns.

How do I apply for Free File?

The IRS makes it easy to access the Free File program. To get started on your tax return using this service, first visit IRS.gov/freefile. According to the IRS, “You must begin your filing option at IRS.gov. Going directly to a (tax software) company’s website will result in not receiving the benefits offered (on the IRS site)”. Once you’re on the IRS site, you’ll see a variety of offers from tax software providers. You simply choose the product that best matches your tax situation. The IRS even has a widget that will help you determine which offer is best for you.

(Note: you can only prepare your current year’s tax return using the Free File program. Previous year’s returns, if you haven’t prepared them yet, need to be completed using another program or by hand.)

Once you have chosen a software provider, you can click through to their website from the IRS website and complete your return, verify it and either print and mail it or submit it via the IRS e-file system. If you opt to file taxes online, you’ll get an email directly from the IRS saying they have accepted your return (if indeed they have).

Free E-File Providers

For the 2021 tax year, there were eight providers in the Free File program. Tax software providers that currently participate in the IRS Free File program include FreeTaxUSA.com, OnlineTaxes.com, TaxAct.com, TaxSlayer.com, FileYourTaxes.com, 1040Now.com, Free1040TaxReturn.com and ezTaxReturn.com. 

Tax software heavyweights, Intuit (TurboTax) and H&R Block were part of the Free File program through the 2020 tax year, but they no longer participate in the program.

Additional benefit to using Free File

In addition to the obvious cost benefit (it’s free), there are several other good reasons to use the IRS Free File program. For instance…

• Each provider guarantees the accuracy of the return you prepare using their software.
• Each provider also offers some type of free customer service to answer any question you might have.
• The IRS prohibits providers from offering you any refund-related bank products while you are preparing your refund, such as refund anticipation loans.

How To File taxes on your own

Of course, you can also file your taxes for free without assistance, by picking up the forms at your local library or other civic building or printing the forms from the IRS website and reading the instructions online. However, US tax law is complex and ever-changing. It can be complicated for someone without a tax accounting background to complete the paperwork accurately.

Where’s My Refund?

The majority of American taxpayers are owed a refund after they file their tax returns. That’s because most Americans work for companies that deduct taxes from weekly, bi-weekly or monthly paychecks. Usually the deduction more than cover a worker’s tax obligation. So, what question do most tax papers ask the minute they’ve filed their return electronically or put it in the mailbox? “Where’s my refund?”, of course. 

Traditionally, the IRS has processed tax refunds quickly if you filed electronically and slightly longer if you filed by mail. However, the events surrounding the COVID-19 pandemic have caused the IRS to reduce staff, at a time when IRS employees have been charged with administering several sets of stimulus checks to Americans. The result last year was longer than usual wait times for tax refunds. This year, according to the IRS, 90% of taxpayers should receive their refunds within 21 days if they opt to have their funds deposited directly into their bank accounts. Paper checks and other refund options take somewhat longer. You can check on current processing times by visiting this IRS page.

If you want to keep track of the progress of your refund, the IRS has created a free app, IRS2Go, that will let you know the status of your tax return.

IRS Phone Number: Customer Service and Human Help

Although it may seem like filing your tax return is a one-sided conversation, the IRS does offer several options to get help and answers if you need them. For example, you can call the IRS customer service phone number 800 829-1040 24 hours a day, seven days a week. Recorded messages on more than 100 tax-related topics are available by dialing 800 829-4477. This number is also available 24/7, seven days a week. 

Keeping old tax records may save you time and energy if you are ever audited or need to file an amended return. Previous year’s tax returns can also be used to prove your income when asking for a loan, such as a mortgage. In this post, we’ll go over how long you should keep tax returns and how to organize your documents in case you need them in the future.

How Long Should You Keep Your Current Tax Returns?

At the very least, you must keep your tax records for three years after the date you filed your return or two years after the day you paid the tax, whichever is later. 1. If you file your return before the deadline, it will be considered filed on the deadline. For example, if you file your tax return in February 2025, five years before the deadline of April 15, 2025, you must keep your tax records until at least April 15, 2030, five years after the return is due.

If you own a company that employs people, you must keep copies of employment tax records for at least four years after the tax is due or paid, whichever comes first.   Creditors or insurance companies may require you to keep tax records for longer than the IRS requires.

Federal Tax Returns

Maintain records for a minimum of three years, as the IRS will typically audit your returns three years from the date of filing. The majority of audits, however, take place within two years of filing. Even three years later, you may find that you do not want to throw away those records. Additional returns may be audited if the IRS discovers a “substantial error,” though it will typically not go back more than six years. There is no statute of limitations on IRS audits if the IRS suspects tax fraud or if you failed to file a tax return for a particular year.

Consider this when disposing of documents that are no longer required to be maintained. Having those documents on hand can help you demonstrate that you followed the rules. And you can always contact the IRS for more information about your specific issue.

Three Years

Maintain three years’ worth of tax returns, along with supporting documents such as W-2s and 1099s. Additionally, you should keep copies of receipts, canceled checks, and credit card or bank records that support any claimed deductions or credits. Maintain property records for at least three years after you sell it, regardless of whether it is your primary residence, another piece of real estate, or investments such as stocks and bonds. Your records will aid you in determining whether you profited or lost money on the sale.

Six Years

If you underreported your income by more than 25% of the amount disclosed on your return, the IRS has six years to audit you. Similarly, if you underreport income from foreign financial assets by more than $5,000, the same regulation applies. If you underreported your income by more than 25% of the amount disclosed on your return, the IRS has six years to audit you. Similarly, if you underreport income from foreign financial assets by more than $5,000, the same regulation applies.

Seven or More Years

If you are writing off a loss due to bad debt or a worthless security, the IRS requires that you retain documents for seven years. The IRS has ten years to collect taxes after determining that you owe them.

State Tax Returns

While many states follow the IRS’s three- and six-year audit timelines, some states give themselves additional time to audit you. These rules have the potential to become quite complicated. For example, California has a four-year statute of limitations on audits and requires you to file an amended state return if the IRS adjusts your tax liability. 56. For information on the rules governing state tax audits, contact your state’s taxing authority. Maintain all records for the duration of the statute of limitations in your state.

Tips for Keeping Tax Returns Organized

It is irrelevant whether you maintain your tax records on paper or electronically. You simply need a system that enables you to locate your records quickly in the event of an emergency.

If you wish to keep paper copies of your tax returns, store them in a fire-and water-resistant safe. Consider creating a new folder for each tax year to organize paper records. Scanning your data and storing it electronically on an encrypted disc or in the cloud, on the other hand, is frequently a more secure and efficient option. Given the sensitivity of the information, ensure that it is protected with a complex and unique password and that two-factor authentication is enabled.

The Internal Revenue Service (IRS) is a federal organization tasked with collecting taxes on the government’s behalf.

If you are self-employed, it is in charge of your deductions and quarterly estimated tax payments, as well as the deductions you make while filing your taxes. If you do not wish to follow IRS requirements, you must, and failure to do so can result in a fine.

That, however, is only a high-level summarization. Learn about the Internal Revenue Service (IRS), what it does, and other relevant facts.

 What is the IRS?

 The Internal Revenue Service (IRS) is the federal agency responsible for enforcing tax laws passed by Congress. Among the agency’s responsibilities are, but are not limited to:

• The IRS is in charge of collecting and processing individual and business income tax returns.
• Keeping track of any taxes that you may owe
• If you overpaid taxes throughout the year, you may be eligible for tax refunds.
• Overseeing certain retirement plans is one of the job responsibilities.
• Investigating federal tax crimes

What Does the IRS Do?

By far the most active division is the IRS’s enforcement division. According to the Tax Policy Center, the IRS spent roughly 40% of its budget on enforcement in 2018, with tax audits and investigations accounting for 83% of that total. The remaining 17% was allocated to oversight and investigations.

Taxpayer services, including as filing assistance and education, garnered around 21% of the total 2018 budget. We don’t just deal with the Internal Revenue Service on a daily basis. In addition, the agency is in charge of administering a number of low- and middle-income tax credits and subsidies, such as the Earned Income Tax Credit and Affordable Care Act subsidies.

Who Owns the IRS?

The Internal Revenue Service (IRS) is a United States Department of Treasury office that considers itself a “tax administrator” and reports to the Treasury Secretary.

Despite the fact that it was not founded by a congressional act, the IRS claims to be a government entity. The IRS bases its position on the 1971 Supreme Court decision Donaldson v. United States, which established that the IRS possessed the authority to administer internal revenue statutes in the manner of an agency.

IRS Leadership

The IRS Commissioner is appointed by the President to lead the IRS. Since the 1950s, appointees have required Senate confirmation. Commissioners are appointed for five-year terms and oversee all operations at the IRS, including tax return processing and enforcement.

When Did Federal Income Tax Start?

The inception of the income tax is traced to the Civil War. The Revenue Act of 1862, signed by Abraham Lincoln, established the “Commissioner of Internal Revenue” and charged him with obtaining cash for the war effort.

The first income tax was charged at a rate of 3% on receipts between $600 and $10,000, and 5% on amounts beyond $10,000. Regardless, ten years later, the tax was repealed.

The income tax, on the other hand, was eliminated in 1894, following the signing of the Revenue Act of 1894 by Wilson. It was revived 22 years later by the Wilson Tariff Act of 1894, which has now become permanent legislation. The 16th Amendment, which allows the federal government to impose an income tax, was enacted in 1913 after three-quarters of Americans secured a majority to amend the Constitution.

The original Form 1040 was produced in 1874. A year later, the first Form 1040 tax return was prepared. The first personal income tax was 1% on earnings above $3,000 and 6% on profits above $500,000. Following World War I, the United States became involved in a new fight. The top tax rate was raised significantly to 77 percent, where it remained for the next ten years. By 1929, the tax rate had been cut to 24 percent, though it was again doubled in response to the Great Depression.

Key Takeaways

• The IRS was established to enforce and monitor the federal tax code. Congress passes legislation, and the IRS is there to implement and regulate it.
• The IRS has long been called a kind of private business by critics, but the government has vehemently denied it. In a 1971 Supreme Court ruling, the IRS was recognized as an agency of the United States.

Common Questions About The IRS

How do I speak to someone at the IRS?

If you received a tax notice and need to speak with someone about it, call the number listed on it. You can reach an IRS customer service person by dialing 800-829-1040 from 7 a.m. to 7 p.m. (local time) Monday through Friday.

You may be asked to confirm personal information and wait while the automated system processes it. For those with hearing impairments, dial 800-829-4059 (TTY/TDD).

Call 800-829-1954 to find out if your refund has been handled. You can also visit with an IRS representative in person at your local office.

Find out more here on how to contact the IRS.

How can I change my bank account information with the IRS?

The IRS delivers money straight to your bank account, such as tax refunds or stimulus payments. You can update your routing and account numbers when you file your return by entering the right information on the tax return form. If you’ve already submitted one, you can phone 800-829-1040.

Communicating with the Internal Revenue Service, or IRS, can be a daunting task — and one that most people would prefer to avoid if possible. But sometimes doing so simply isn’t avoidable: perhaps your tax return or refund never arrived, there’s an issue with a child tax credit or other credits, or you need to work out a payment plan.

The IRS continues to modernize its systems and methods, and you’ll find more and more options for solving your problems online. These days you can check your refund status, complete your entire tax filing, request forms, and so much more, all online and without talking to an IRS agent. But there are still plenty of scenarios where online tools won’t cut it. You need a live person to solve your problem.

Below, we’ll show you the primary way to contact IRS customer service by phone, along with a range of other options that might save you time.

The Main Way to Contact IRS Customer Service

The most common and most popular way to contact IRS customer service and reach a real human (eventually) is to call the main phone number: (800) 829-1040. That’s the primary IRS phone number listed on the IRS website, and it will get you to a live human eventually.

If that number sounds familiar, there’s a reason. Look at the last four digits again. Ending the number in 1040, the digits associated with the most common individual tax filing form, is a clever touch — and it might just help you remember the number in a pinch.

The primary phone number is connected to the IRS customer service center, which operates from 7 a.m. to 7 p.m. “local time,” in the words of the IRS itself. Since local time looks different from coast to coast, it’s safe to assume that this number will operate from 7 a.m. Eastern (4 a.m. Pacific) to 10 p.m. Eastern (7 p.m. Pacific). Residents of Alaska and Hawaii are advised to follow Pacific time.

Other Ways to Contact a Real Person at the IRS

While the main line is a highly flexible way to contact the IRS, it may not be the fastest or most direct way to get your answer. On top of that, there’s a whole range of complex topics and categories that the IRS telephone assistors can’t address via phone. This list includes many topics related to capital gains and losses (including bitcoin and other cryptocurrency), depreciation, questions arising from the sale of a business, and more.

If you need an alternate way to contact a real person at the IRS, try these methods.

Other IRS Phone Numbers

The IRS maintains a range of other phone numbers for departments and services that deal with specific issues. Try one of these numbers if any of them makes sense for your situation.

• Businesses: (800) 829-4933
• Non-profit tax issues: (877) 829-5500
• Estate and gift taxes: (866) 699-4083
• Excise taxes: (866) 699-4096
• Hearing impaired: TTY/TDD (800) 829-4059
• Interpretation services (350+ languages, other than English and Spanish): (833) 553-9895

Spanish-speaking individual customers should call the main line at (800) 829-1040 and select español from the menu rather than use the interpretation services number above.

In addition to these general department-style numbers, NerdWallet points out a range of much more specific numbers:

• Problems with a stimulus check: (800) 919-9835
• Self-employed taxpayers: (800) 829-4933
• Identity theft victims (including theft of tax returns): (800) 908-4490
• Order a tax transcript: (800) 908-9946
• Innocent spouse tax relief: (866) 681-4271
• International taxpayer advocate: (787) 522-8601 [English]; (787) 522-8600 [Spanish]

Between all these alternate numbers, you’ll find answers to an extremely wide range of tax filing questions.

Visit Your Local IRS Office

If your question or problem isn’t something you’re able to solve over the phone, visiting a local IRS office is an option. Sometimes sitting down face to face with a real person is the best approach, even if it isn’t the fastest.

The IRS maintains several hundred local offices, sometimes called Taxpayer Assistance Centers, located in small and midsized cities as well as large metropolitan areas. You can locate an office near you with the IRS Taxpayer Assistance Center Office Locator.

If you’re dealing with an issue that assistors aren’t able to solve over the phone or you just can’t seem to get a clear answer, then an in-person visit may be the best option for you. Make sure to schedule an appointment, though, as walk-ins generally aren’t accepted. You can do so through the locator link above or by calling (844) 545-5640.

Reach the IRS by Mail

While the IRS itself discourages doing so, it’s still possible to send in your tax forms by mail, including tax payments. This is usually the slowest method of interacting with the IRS — by a long shot. Minimum wait times for a reply by mail from the IRS is around 30 days, and you’ll often have to wait considerably longer than that. As of publishing time, the IRS even warns of additional delays due to staffing shortages.

We won’t provide the address here because the IRS could change them at any time, and they vary from state to state and whether you’re including a payment or not. To find the right mailing address for your correspondence, visit this resource from the IRS.

Try Calling the Taxpayer Advocate Service

If you’re struggling to get the information you need or you feel like you’re up against a wall with the IRS, the Taxpayer Advocate Service should be your next call. The Taxpayer Advocate Service is a different part of the IRS—a distinct independent organization within it, in fact.

Taxpayer Advocate Service centers operate independently from nearby local IRS offices and don’t even report to them — they report to the National Taxpayer Advocate Service instead.

If you need a voice at the IRS and you don’t find one through the other methods, the Taxpayer Advocate Serviceexists to be “your voice at the IRS.”

You should call the Taxpayer Advocate Service if you’re dealing with one of these situations, among others:

• Financial hardship, especially related to your tax bill
• The threat of adverse action
• You can’t get through to the appropriate party at the IRS (or aren’t getting a reply by a promised date)

Every state has at least one local Taxpayer Advocate office. Larger states (by population or geography) have more. You can find the contact information for your state’s local Taxpayer Advocate using the Taxpayer Advocate Service locator page.

Wrapping Up

We hope this article answered every question you may have about how to contact the IRS, including how to reach out to the Taxpayer Advocate Service if needed. Do you have additional tax-related questions we didn’t cover here? We’re always ready to help! Reach out today if we can assist you further.