IRS Has Warning for People in 21 States
The Internal Revenue Service (IRS) has warned taxpayers in 21 states to file an amendment, thanks to the Biden administration’s COVID-19 stimulus handout.
On April 11, the IRS released a press release advising millions of taxpayers to file amended tax forms now that the agency has decided that the stimulus checks given during the height of the pandemic aren’t taxable.
IRS: Taxpayers in 21 states should consider amending returns https://t.co/QwEPLvA41r
— ABC 10News San Diego (@10News) April 12, 2023
“During a review, the IRS determined that in the interest of sound tax administration and other factors, taxpayers in many states did not need to report these payments on their 2022 tax returns. Consequently, the IRS will not challenge the taxability of state payments related to general welfare and disaster relief,” they said in the press release.
Up to 28.8 million taxpayers who submitted their tax returns prior to February 10 are impacted by the announcement. Alaska, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Indiana, Maine, Massachusetts, New Jersey, New Mexico, New York, Oregon, Pennsylvania, South Carolina, Rhode Island, and Virginia are the states affected.
The IRS is now advising anyone in these states who filed their taxes early and included stimulus money as income to see if they paid the extra tax. The filing deadline for 2022 tax returns is April 18, but the IRS will accept amended 2022 returns until April 2026.
“Taxpayers who filed before Feb. 10 in these areas and meet these requirements should check their tax return to make sure they paid tax on a state refund before filing an amended return. In addition, taxpayers in this situation who used a tax professional can consult with them to determine whether an amended return is necessary,” the press release continued.
This comes as the IRS is reportedly ramping up audits on Americans, thanks to President Joe Biden’s “Inflation Reduction Act.”
According to an April 6 report by the U.S. Department of the Treasury and the IRS, the agency would begin using some of the legislation’s $80 million funding to boost audits. The target demographics are those who make more than $400,000 a year and business owners who file intricate taxes.
Since Biden signed the measure last August, some Republican lawmakers have claimed that the IRS would use the money to hire an army of 87,000 tax agents with weapons.
“The last thing the American people need right now are more audits from an out-of-control, bloated IRS,” said Nebraska Rep. Adrian Smith at the time. “The Inflation Act funding for IRS would lead to the hiring of 87,000 new IRS employees tasked with raising enough revenue to pay for Democrats’ Green New Deal priorities.”
