Clients who filed MFJ in February, qualified for unemployment exclusion on separate returns with $20,000 UC considered community income. Superseding MFS returns were filed before April 15. Still no refunds from IRS, which admits that in many cases it is taking six months to process amended returns.
Has anyone else seen results from such returns? Is anyone else still waiting?
Still have at least one client waiting for the IRS to make the uce adjustment like they said they would... MFJ return filed in March and they still have not received the additional refund from the uce adjustment... There should be no issue with this as the return is straightforward... So if they can't take care of this on time then I'm not surprised about what is happening with your returns....
Yes, they did say that MFJ returns would be the last ones for which they would be making the "automatic" UCE adjustments. And as you say, those without a change in filing status and not involving community income would be much easier than mine. When you wrote "I'm not surprised about....", I thought the next line would be "...how many of us predict the next tax season will be even worse than the last one."
So my clients just emailed me a copy of the notice IRS sent the wife.
The good news is that it shows the same AGI, taxable income and withholding credits as those reported on her superseding return.
The bad news is that it doesn't show her half of the single $8,500 ES payment that had been made jointly in September. As a result, she is being billed for !,500 plus interest and FTP penalty, rather than receiving a refund of $2,750 plus interest. (Each return claimed half the ES payment.)
The good news is that for the husband, "Where's My Refund" is accessible using the refund amount shown on his superseding return.
The bad news is that his return is still being processed.
I told them to wait a few weeks and hope the husband's refund shows up, including all of the ES payment and not just half of it.
They're smart enough to set up an online account, so we might try further research that way.
I would have claimed the entire payment on the husband's return, but that would have resulted in the wife owing tax. (Which happened anyway.) On a joint return, even without the UCE, they would have received a refund. I didn't want to tell them to pay something in April, then wait until December for a refund.
IRS clerks are supposed to know how to split ES payments. They just didn't want to be bothered.
Bob... good luck with it. I spent a total of 5 plus hours on the phone with PPS two weeks ago to get some of the payments "moved" from the hubby account to the spouse account. I hope they've been moved; no paperwork yet. He could only do two on one phone call, so I gave up on the third one. Much smaller amounts involved on # 3 so waiting for the letters I've sent to be processed is the choice for now.
Fortunately, just one payment here -- they had a large capital gain early in the year and wanted to cover it in the quarter received.
What do the Form 1040 Instructions say about this?
"If you and your spouse paid joint estimated tax but are now filing separate income tax returns, you can divide the amount paid in any way you choose as long as you both agree. If you can't agree, you must divide the payments in proportion to each spouse's individual tax as shown on your separate returns for 2020. For more information, see Pub. 505. Be sure to show both social security numbers (SSNs) in the space provided on the separate returns."
They left out the part, "Don't be surprised if we screw this up."