Tax Time

Dear Dr. Per Cap:

Last year, the IRS issued an extension for filing. Can we expect the same in 2022?

Signed,

Procrastinator


Dear Procrastinator,

Not likely. The filing deadline extensions for tax years 2019 and 2020 were responses to the chaos and disruption caused by the coronavirus pandemic.

For better or worse, the Internal Revenue Service contends that we’re back to enough normality for a standard filing deadline for tax year 2021. For most individuals, that day is April 18, 2022.

The IRS will begin accepting tax returns on Jan. 24, so now is the time to begin gathering wage and earnings statements, receipts for deductible expenses, and other records needed to file an accurate return.

For many folks this will include IRS letter 6419 that lists the total of advance child tax credit payments received last year. Those were monthly payments issued by check or direct deposit from mid-July through mid-December to help income-eligible families weather financial uncertainties.

My good friend and colleague, Henry Thompson, runs a Volunteer Income Tax Assistance (VITA) site in Lame Deer, Montana, and warns that people need to wait for letter 6419 before filing. Choosing otherwise could result in a lengthy delay if you report the wrong total for those payments when filling out a return.

Also, be aware that the IRS is expecting delays with processing returns and long hold times when trying to reach them by phone. But that’s probably not big news for anyone who has ever killed the better part of a Tuesday afternoon waiting for an IRS representative to explain if pow-wow gear is tax-deductible. Here’s the short answer: maybe.

A heavy backlog of 2020 returns waiting to be processed, IRS staffing shortages, and dealing with new tax benefits and programs created during the pandemic are the main factors at work here.

Plan ahead and take advantage of e-filing if you haven’t already by visiting the IRS website for a list of tax-prep companies offering free filing for income-eligible taxpayers.

Or check out one of the many VITA sites that serve Native communities, in partnership with Tribal colleges, libraries, and community development financial institutions.


Ask Dr. Per Cap is a program funded by First Nations Development Institute with assistance from the FINRA Investor Education Foundation. For more information, visit www.firstnations.org. To send a question to Dr. Per Cap, email askdrpercap@firstnations.org.