By Jose Carranza
FAYETTEVILLE, Ark. (UATV) — Tax season is beginning and industry professionals stress the importance of using caution when students are filing their taxes.
At the University of Arkansas, associate professor TJ Atwood is the Tax Curriculum director in the Department of Accounting. She’s actively working to inform students on important things to know going into this upcoming tax season.
“Students must file Form 1040 if they owe any income tax or if they had income taxes withheld from their pay and are eligible to claim a refund,” said Atwood. “In the simplest case, the student should add their wage income [from the W-2 provided by their employer] and any investment income [such as interest or dividend income from the Form 1099s provided by the payors].”
To file taxes, the base required documents are the W-2 and 1099 forms.
The deadline to meet in turning in the tax forms is April 15th. However, there is an exception.
“They are due by April 15th, 2020 but you can file Form 4868 to get an automatic 6-month extension (to October 15, 2020),” said Atwood. “The extension applies only to file the forms, any taxes you owe must be paid by April 15, 2020 to avoid penalties.”
According to Atwood, people can also turn in their forms via e-file or mail to the IRS.
When asked about the ways the university helps students filing taxes, the VITA program is mentioned by Atwood. Under the VITA program you can find CARE, the Care Community Center in NWA. Kimberly Porter, executive director of CARE, founded the center in 2013.
“CARE Community Center operates the largest free file program in NWA. CARE has seven tax center locations operating for the 2020 filing season,” said Porter. “Our main office in Rogers is open year round and also offers Certified Acceptance Agent services for those needing to establish or renew and ITIN.”
One of the most common issues is forgetting to file. Both Atwood and Porter mention how students forget to file entirely as well as missing information when filing.
“Forgetting to include all income from any investment accounts that are tied to the student’s social security number,” said Atwood when asked what common mistakes are made by young adults. “Also, remembering to limit the standard deduction if they are claimed as a dependent by their parents.”
Porter list these points for precaution when :
• Scams – The IRS does not email or cold call taxpayers. If you receive an email or phone call it is most likely a scam. You can always reach out to the IRS by calling 1-800-829-1040.
• When looking at Free File services on the internet make sure to read the fine print. Some of the services only prepare the Federal return for free and charge for the corresponding State return.
• Protect your Identity. Don’t enter your personal information into a website that is not secure or a promotional link you may receive via text or email.
• Beware of businesses that prepare taxes as part of a purchase. Read the fine print and know the fees associated with the tax preparation service. Ask if you are receiving a loan related to the tax refund for your down payment. Ask if you are paying additional fees for the loan against your refund.
• There is no such thing as getting a refund faster. E-file processing is the same for paid and free file services. Refund anticipation loans and other similar products may help you get a portion of the refund faster, however there is a loan or preparation fee associated with this process.
For a complete listing of the 7 locations, click here.
Each taxpayer must have the following:
· Proof of identification – Valid State or Federal Photo ID
· Social Security Cards for you, your spouse and dependents
· Individual Taxpayer Identification Number (ITIN) assignment letter for you, your spouse and dependents (if applicable)
· Proof of foreign status, if applying for an ITIN (Rogers location CAA service)
· Birth dates for you, your spouse and dependents on the tax return
· Wage and earning statement(s) Form W-2, W-2G, 1099-R, 1099-Misc from (Must have all information to file your return)
· If self-employed, all business expenses you want to claim on your taxes
· Interest and dividend statements from banks (Forms 1099)
· A copy of last year’s federal and state returns if available
· Proof of bank account routing numbers and account numbers for Direct Deposit, such as a blank check
· Total paid for daycare provider and the daycare provider’s tax identifying number (the provider’s Social Security Number or the provider’s business Employer Identification Number) if appropriate
· To file taxes electronically on a married-filing-joint tax return, both spouses must be present to sign the required forms.
If taxpayers can contact taxcenter@carecc.org with any additional questions.