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Webinar: IRS Letters and Important Updates. Recording and Live Q&A Transcript

Webinar: IRS Letters and Important Updates. Recording and Live Q&A Transcript
Ines Zemelman, EA
21 February 2022

On February 17, 2022, we hosted a webinar on recent IRS letters and important updates which included live Q&A with our tax experts. You can access the recording and we’ve also transcribed this Q&A transcript. 

We’ve grouped the questions by topic and we’ve also added links to relevant articles below.

Streamlined procedure

Q: I have not filed since 2003. Can I file now?

A: Definitely - taxesforexpats.com/services/new-irs-program-delinquent-taxes.html - our team can help you get caught up and there is a special program to do so without penalty.

Stimulus Checks & Advance Child Tax Credit 

Q: I haven’t gotten my second and third stimulus checks. I try to make an account on the IRS website to check what happened with my refund. However, I need a US address to open an account, which I do not have. What should I do?

A: The IRS is currently developing a new way to verify taxpayers' identities. This is expected to come in a few weeks. When this new procedure rolls out, we will determine if it is suitable for overseas taxpayers without US addresses.

Q: Thank you, in the meanwhile is there another method to check where the refund is?

A: May need to call them if it's very delayed.

 

Q: Were US residents living outside the US eligible for the coronavirus stimulus checks?

A: Yes. There were three stimulus payments, if you were a US citizen you were eligible. Get in touch with TFX and we’ll see what we can do to help you reclaim those.

 

Q: If one person has kids and they are citizens since 2 years ago but they didn't have SSN can they claim the advance child tax credit and the stimulus?

A: For the most part, no. Upload all the information to our tax questionnaire and we’ll prepare a tax return and see if there’s any way to claim anything. 

 

Q: My economic impact check was lost. What should I do?

A: Contact us, and we will guide you to the place where you can request another check.

 

Q: Any possibility to claim advance child tax credit if lived in Canada throughout 2021 during the pandemic? Thank you.

A: The Advance Credit was paid from July and December, and no, you wouldn’t be eligible.  And you must have lived in the US. But you can claim the Child Tax Credit on the return. 

 

Q: Received Advance Child Tax payment, but don’t live in the U.S…. a problem?

A: You might need to pay that back. It depends on how much you’re eligible for. When we file a return we’ll certainly take that into account. 

 

Q: We received all three economic payments, but haven’t received a letter from the IRS. What does TFX need for documentation?

A: Upload all the information to our tax questionnaire to the section where we ask how much you received and add a separate note that says that you didn’t receive these letters. That’s not a problem. 

 

Q: Is the child tax credit for US citizens living abroad the same as the amount received by US citizens living in the US?

A: True for the nonrefundable child tax credit. But for the refundable portion, taxpayers who didn't live in the US for over six months will be limited to $1,400 per child like last year (TCJA rules).

 

Q: I am a US citizen living in NL and am self-employed. I have a registered business in both US and NL, is Form 8858 required?

A: We’ll determine what forms you need to file — complete our tax questionnaire and our experts will handle it for you.

Q: For non-US residents, is the Child Tax Credit higher this year?

A: No increase for 2022 has been written into law. The American Rescue Plan Act of 2021 only increased CTC for 2021 (see Section 9611 of the bill https://www.congress.gov/bill/117th-congress/house-bill/1319/text ) I would also strike the "You are subject to the same rules as if you were living here" since the amount of the refundable portion of the credit depends on US residency.

6475

Q: When was the 6475 supposed to have come?

A: They were sent in early Feb. Hopefully you get it soon. You can also check the amount of EIP3 you received in your bank account but the letter is best.

Q: That probably means I’ll get it in April (I’m in Chile and mail is slow coming from the U.S.). Also no electronic deposits, only paper checks that were also slowwww to come ;-)

A: Sure, you can still file without it just need to know how much.

 

Q: If we didn't get the 6475 but did get the check in the mail last year, should we delay in filing until we do get the 6475?

A: Not necessarily if you know for certain the amount you received.

 

Q: I am overseas and have not have received my 6475. I get deposits to my bank. What does the 3rd payment say on the bank statement so I can search for it?

A: Should say something about Treasury or IRS. Your bank statement will say something like "IRS TREAS 310 DES: CHILDCTC."

 

Q: Don’t know if we got 6745

A: If you don’t - you likely didn’t :) But our team will handle everything for you - you can check your bank account to see if you received any payment. If you didn’t - and eligible, we’ll get it for you during tax prep

ID.me & IRS Website

Q: I have tried signing up with ID.me, but cannot get my photo ID uploaded. Only receive error messages for both mobile and desktop.

A: They retracted the ID.me signup so that might be a reason.

 

Q: So IRS’ intent to use ID.me is dead?

A: The IRS has indicated that the face recognition process will be discontinued - they have not given specifics yet of the upcoming process.

 

Q: What is the best way to obtain a copy of my tax transcript from the IRS? (the ID.me site is inaccessible to me where I live and the company was unable to assist me in creating an account)

A: We can obtain these very easily as part of our Representation services.

 

Q: Hello, I do have the problem of how to register with the IRS. As you need an American cell phone. With an Austrian phone, you can’t do it.

A: You can utilize google voice to create a local number in the US. 

 

Q: Would you be familiar with how to register with the IRS and Google voice? Do you have details how that works?

A: Unfortunately, we cannot assist with the actual IRS website - it is fairly self-explanatory with the steps, albeit their technology isn’t the best.

 

Q: What is the fastest way to get an activity transcript from the IRS?

A: You go to the IRS website and look for the transcript. There is a webpage. If you need help, let us know.

 

Q: Is there an IRS website where I can see past letters issued to me by the IRS?

A: They don't have this. The best you can do is obtain transcripts.

 

Q: When IRS will finalize forms? And be available to finis my return?

A: Depends on the form - we’ll finalize as soon as it’s ready!

Other questions

Q: I am from India and have an LLC company in Wyoming state. What tax is applied to me? 

A: Thank you for your question. Our qualified tax experts can answer your question in depth during a tax planning consultation. For more information, please follow this link: https://www.taxesforexpats.com/services/consultation.html#tax-planning

 

Q: Hello. We live in the UK. When should we expect to get refunds of US taxes wrongly taken from a 403B payout? We filed our 2020 US 1040 last September and amended forms for previous years when we wrongly paid US taxes instead of UK taxes.

A: Amended returns are normally processed within 4 months.  You can check the refund status on the IRS website.

 

Q: Hi, I’m not receiving any mail from the IRS to my address abroad, since changing my address a year ago from a USA address.

A: Missing mail to foreign addresses is a common issue.  You can consider using a US c/o address or virtual mailing service.

 

Q: I am a U.S. citizen living in Italy. I had the understanding that self-employed U.S. citizens have to pay self-employment tax (SS/Medicare), regardless of whether or not we make social security contributions in other countries. However, when filling out my taxes, I was asked whether or not I contributed to another country's social security system and that if I did, I was exempt from U.S. self-employment tax. Perhaps it depends on the country?

A: Yes, the exemption of SECA varies by country.

 

Q: I received a Notice CP81 for tax year 2018 stating that I have a credit on my account, but they have not credited to the return. When I call to enquire why, the wait time is 2-3 hours, what can I do?

A: Thank you for your question. We can contact the IRS on your behalf to resolve this issue. For more information about our representation services, please follow this link: taxesforexpats.com/services/irs-representation.html

 

Q: I recently sold my primary resident property in Colombia after buying the land about 11 years ago, on which I build the house. Do I need to declare the almost $100k capital gain from this sale on my 1040 return even though the capital gain was less than the $250,000 exception?

A: Yes - you must report on your tax return. Our team will handle everything for you - just let us know about your home sale on your tax questionnaire. If you are not yet a client, please sign up - taxesforexpats.com/signup

 

Q: Hello, I have lived in Panama for the last 4 years but have not changed my country of residence, can and should I disclose this now and will it cause any problems for past returns?

A: When filing your return, we will simply use your current address where the IRS can reach you.

 

Q: We used a different tax preparer last year for our US taxes. Now we can't see whether we have a refund pending. Is there any way a new preparer-you--can access this info?

A: Yes, but this requires power of attorney.  We can't check earlier years just because we prepare for the current year.

 

Q: I sent my 2020 by USPS priority (tracked) mail-in early Sept for Oct due date. No sign of it and IRS said no return was received when asked in Dec.

A: IRS takes 16 weeks to process mailed returns and has a large backlog.

 

Q: Schedule E 1040NR is 16th June deadline?

A: If no W-2, the deadline is for form 1040-NR is June 15, 2022.

 

Q: I will for the first time, as Spain resident, include my spouse as RA for tax purposes filing jointly. What deadline applies?

A: In this case you are a US citizen so the regular US citizen’s deadline applies. 

 

Q: I am a US citizen living permanently in the UK.  I assume that I must pay US tax on US sources of income and use that tax as a credit on my UK tax return, and pay UK tax on UK sources of income and use that tax on Form 1116 as a credit against US taxes on that foreign income.  Is that correct?

A: We’ll handle everything for you during tax prep. That’s why you hire us - and why you make money from what you are an expert in :)

 

Q: April 18 is Easter Monday - how can they be due on a holiday, let alone a long holiday weekend with Good Friday? Won't this affect the post and open/closing of offices?

A: It’s all electronically e-filed.

 

Q: Does Taxes for Expats e-file or file with paper?

A: Of course - we e-file everything!

 

Q: I am a US citizen and my wife is not, how should I fill out as single or together.

A: Fill in your TQ with both information - we’ll determine the best way for you to file

 

Q: Does my 18 y.o child living as a student and working p/t in Canada need to prepare tax?

A: If he has enough taxable income to qualify the answer is yes. Fill out our tax questionnaire and our CPAs will look at it and make sure whether he does or he doesn’t need to. If he doesn’t need to file, we won’t file for him.

 

Q: In the period between removing our current tax preparer and hiring you, can we use the IRS website feature "Where's My Amended Return?" and "Refund Status?" Does the hiring of a tax preparer preclude the taxpayer from using these functions?

A: You can use those IRS websites regardless of who your CPA is.

 

Q: Are SSA benefits subject to tax in Spain?

A: That’s a good question, and our CPAs will handle that for you during tax preparation.

 

Q: As a retired Social Security only income, do I file taxes?

A: It depends - please see minimum filing requirements  - once you complete our tax questionnaire our team will analyze and let you know specifically what you need to (or don't need to) file.

 

Q: 1099K from PayPal issues as they were friends paying me back not actual business expenses but when contacting PayPal they said there's nothing they can do about it - do I need to file this if they were not business payments?

A: We’ll have to see exactly what the 1099K says. We handle that during tax preparation.

 

Q: I did not have an income over 11000$/year.

A: Our team will determine your filing requirements once you give us your information - taxesforexpats.com/signup

 

Q: How do you handle Crypto gains?

A: The proper way :) Our team will handle everything for you.

Ines Zemelman, EA
Founder of TFX