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Tax season kicks off Jan. 29: Withholding guidance coming

The Internal Revenue Service announced tax season, for both electronic and paper tax returns, will begin Monday, Jan. 29 and end April 17, giving taxpayers two additional days to file beyond April 15.

In 2018, April 15 falls on a Sunday, and this would usually move the filing deadline to the following Monday – April 16. However, Emancipation Day – a legal holiday in the District of Columbia – will be observed on that Monday, which pushes the nation’s filing deadline to Tuesday, April 17, 2018. Under the tax law, legal holidays in the District of Columbia affect the filing deadline across the nation.

Along with the announcement, the IRS issued several reminders:

  • By law, the IRS cannot issue refunds on tax returns claiming the Earned Income Tax Credit or the Additional Child Tax Credit before mid-February. This applies to the entire refund — even the portion not associated with the EITC and ACTC. 
  • Many financial institutions do not process payments on weekends or holidays, which can affect when refunds reach taxpayers.
  • Taxpayers should keep copies of their prior-year tax returns for at least three years. 
  • E-file and direct deposit for refunds are the fastest and safest way to file an accurate income tax return and receive a refund. 

Read more: 2018 tax filing season begins Jan. 29

Withholding guidance coming

The IRS is working to develop withholding guidance to implement the tax reform bill signed into law on December 22. Initial withholding guidance is expected in January and employers and payroll service providers will be encouraged to implement the changes in February. The IRS emphasizes this information will be designed to work with the existing Forms W-4 that employees have already filed, and no further action by taxpayers is needed at this time.

Use of the new 2018 withholding guidelines will allow taxpayers to begin seeing the changes in their paychecks as early as February. In the meantime, employers and payroll service providers should continue to use the existing 2017 withholding tables and systems.

Read more: IRS statement withholding for 2018  

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Judy Vorndran can be reached at jvorndran@taxops.com or 720.227.0093. Follow Judy on LinkedIn.

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