Month: April 2025

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mycurator

Avoid IRS Penalties & Interest: If you owe taxes on Social Security or other income (like dividends or retirement withdrawals), you must make quarterly payments. Missing these deadlines can lead to penalties and interest, cutting into your retirement income. Improve Budgeting & Reduce Stress: Early tax filing eliminates surprise tax bills, helping retirees on fixed […]

  1. Avoid IRS Penalties & Interest:
    If you owe taxes on Social Security or other income (like dividends or retirement withdrawals), you must make quarterly payments. Missing these deadlines can lead to penalties and interest, cutting into your retirement income.
  2. Improve Budgeting & Reduce Stress:
    Early tax filing eliminates surprise tax bills, helping retirees on fixed incomes plan more effectively and avoid last-minute financial strain.
  3. Protect Your Social Security Payments:
    Ignoring tax bills can result in garnishment of up to 15% of your Social Security through the Federal Payment Levy Program. Paying early helps prevent this.
  4. More Time to Fix Issues:
    Social Security complicates tax returns, especially if you have other income. Starting early gives you time to address errors or missing forms like 1099-Rs, reducing the risk of delays or amended returns.
  5. Withholding Option:
    You can file IRS Form W-4V to have taxes withheld from Social Security payments, helping you stay current year-round and potentially reducing what you owe at tax time.
  6. Faster Refunds:
    If you’re owed a refund, filing early ensures you get it sooner — freeing up money for essentials or enjoyment.

Check out the original article by Choncé Maddox here.

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mycurator

Thousands of recent layoffs at the IRS — including 6,000 to 7,000 probationary employees in February — could significantly impact key agency functions during the peak of tax season. The cuts, part of broader federal workforce reductions under the new Trump administration, may affect tax return processing, refund issuance, audits, and collection enforcement. A court […]

Thousands of recent layoffs at the IRS — including 6,000 to 7,000 probationary employees in February — could significantly impact key agency functions during the peak of tax season. The cuts, part of broader federal workforce reductions under the new Trump administration, may affect tax return processing, refund issuance, audits, and collection enforcement.

A court has since ordered the reinstatement of some laid-off employees, but the ultimate number of IRS job cuts remains uncertain. Experts warn the timing is especially problematic, as the agency is busiest during filing season.

Financially, the downsizing could harm IRS efficiency. The agency collected over $5.1 trillion in 2024 and plays a crucial role in closing the annual $600 billion to $1 trillion tax gap. Studies show IRS enforcement spending yields high returns — $5 to $12 for every $1 spent — making budget cuts to the agency counterproductive, especially when revenue collection is critical.

The full impact on taxpayers is still unfolding, but delays and reduced enforcement capacity are likely.

Check out the original article by Jeff Huang here.