IRS Delays Accepting Returns That Include 31 Types of Forms

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By Frank Byrt

The IRS announced January 28, 2013, that it won't accept returns for processing that include Form 8863, Education Credits, until mid-February, or two weeks after the 2013 tax filing season begins. The IRS also won't accept returns that include thirty other tax forms used to claim credits or deductions until sometime in February or March because they all needed revisions. 
 
Preeminent among them is Form 4562, Depreciation and Amortization
 
The delay is a result of Congress not having approved tax law changes under the American Taxpayer Relief Act until January 2. That caused the IRS to push back the opening of tax filing system to January 30 and required changes to certain subsidiary tax forms along with its return-processing system.
 
"No action needs to be taken by the taxpayer or their tax professional," the IRS said, in a January 28 website posting regarding Form 8863, Education Credits, which is used to claim two types of higher education credits: the American Opportunity Tax Credit and the Lifetime Learning Credit.
 
It isn't expected to have a large impact as "typically through the mid-February period, about three million tax returns include Form 8863, less than a quarter of those filed during the year," the IRS said.
 
The IRS also noted that the delay will have no impact on taxpayers claiming other education-related tax benefits, including those "claiming the student loan interest deduction on the Form 1040 series or the higher education tuition or fees on Form 8917, Tuition and Fees Deduction."  They will be able to file beginning January 30. 
 
But the IRS also said that 1040 filers using thirty other subsidiary tax forms used to claim deductions or credits cannot file until those forms become available because they required changes that have caused similar processing issues. A date will be announced when these forms will be accepted, but that date will probably be in late February or March, the IRS said. 
 
Benson Goldstein, senior technical manager on the AICPA tax staff, told AccountingWEB in an interview that the AICPA hasn't received a lot of calls about the problems these issues may present, most likely because tax season just started. 
 
But he added that Form 4562, Depreciation and Amortization (Including Information on Listed Property), "is very important" for taxpayers and preparers, so any delays in the availability of it and other forms, potentially out as far as March, "can cause traffic bottlenecks for tax preparers and their offices. 
 
"We have raised this issue with the IRS in the last several days and used the depreciation form as an example. We are encouraging them to get the forms out as timely as possible," Goldstein said.  
 
Carol Benintendi, a CPA practicing in Newtonville, Massachusetts, told AccountingWEB, "This is going to make my life hell. Today I'm trying to get some business returns done," but without the availability of several forms on her firm's tax preparation software, she said she can only prepare a business return with a depreciation deduction to a certain point before having to put it aside and move on to the next one and do the same, knowing that she'll have to return to them once the IRS issues the revised forms.
 
"The biggest concern for me is the depreciation [form]. My clients are mostly businesses or individuals who are self-employed or have rental activity," so it's crucial to completing the return, she said.
 
Eventually, she says, there will be a deadline crunch for tax preparers once the new forms become available, because they'll then have to rush to complete returns and then get together with clients so they can review and sign them ahead of the filing deadline. "I personally wouldn't send [a return] to clients for approval until it's final because you can't anticipate what might change.
 
"It's frustrating, but this is one of those times I can't blame the IRS," Benintendi said, since Congress didn't approve changes to the tax laws in enough time to give the IRS a chance to revise the tax forms and test its processing software before the start of tax season. 
 
Similarly, Shayna Chapman, a partner in Chapman & Burris CPAs LLC in Gallipolis, Ohio, told AccountingWEB that most of her firm's clients are businesses, so they would use Form 4562 for a depreciation deduction, while the Form 8863, Education Credit, is less of a concern.
 
"It's a little bit of a big deal" with the depreciation form, she said, because the IRS says you can't sit on your tax returns and then e-file them all at once. 
 
"But that's exactly what we'll have to do" if there are significant delays in release of the forms. "So we have to do as much as we can, then move [the returns] to the side, and then when the forms get released, we can start e-filing. There could be a bottleneck since everybody's going to push through at the same time."
 
Chapman said she'll keep clients notified on the process via her firm's Facebook page, or she'll contact them directly via text message and e-mail.
 
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Funny how when they want there money everything is in order and they come after you but when you want your there are delays and paperwork. Smh

typical government crap how long does it take to change a phone they have thousands and thousands of employees make them work the weekendthey had no problem taking my money all year long but now they want to hold on to it just a little longerthis is why the government should stay out of our lives

:-(! This has become more of a mess than it is worth! I usually file early and then go back and ammend because my school doesn't send the 1098T out soon enough. Finally, they send it to me early and I think everything is good....now this! To top it off, I can't amend and take it off! Just a sitting duck!

This was just announced on 1/28 which is unfair. I was under the impression that my return would be accepted by 1/30 when I completed my forms with taxact on 1/25/13. Was not warned of a future delay because of this form.

Just junk, some of us desperately need our tax return. Our govt let us down again. When is the govt going to start dealing with next years tax? Xmas? New Year's Eve. Our govt has let us down. I rarely speak on politics because people can only blame demo if they are rep or rep if they are demo. They both have failed here. Our politics suck because we can not put our political party ideas to the side.

Now what happens to returns that Tax Cut DID transmit to the IRS with the depreciation forms on Jan 30th??

Congress is absolutely broke. What a cluster F. Totally incompetent and worthless. Their ineptness causes mass disruption for the nations tax payers.

what? its my money and i need it now!

What a joke! Did they not know taxes are filed every year at the same time. I already filed but won't be excepted till late February or March, so when I owe taxes I can take an extra two or three months to pay right. Come on government get on the ball.dont get me started on new takes out of my check what happen to sharing the wealth, that's right only if u are welfare. Quite ur jobs and enjoy the wealth!,,,,,,,, some of us work for a living and guess what live payday to payday this return pays my property tax would u mind calling and telling them it will be a few months late?

this totally sucks! it's not our fault that government can't get their crap together and get the right forms out to the IRS!!!!!! I want my refund .....

It is congress's fault that these forms are delayed and not the IRS. And they still can't get there act together. I work for the government and the fiscal cliff has delayed my return and now I will get furloughed if they still can't get the budget together by the 1 March. Which in my case means thousand less this year on my income, not to mention that I have not had will not get a cost of living raise in over three years. And of course the deductions such as insurance from my check and the rising cost of gas, food, clothing, and such keep reducing my buying power.

Another thought - if the IRS is part of the government will it take even longer to get your return because they will not be working overtime and work less days per pay period? More delays???

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Maybe congress needs more vacation days and another raise?

buggs me because I filed jan 25 and no one told me this was a o\hold up! So i been waiting for ever..This is crazy over 2 rent houses that DO NOT MAKE US RICH..OK

Are they going to pay me interest on MY money that I am waiting on? They have no problem charging interest when we owe money.....

I filed both State and Fed on 01/28/2012 received notification on 02/14/13 both state and fed received it. Got my state return as of 03/07/2013 still waiting for my federal...another day wasted thanks to the IRS.

This is a classic example of our failing government.
Here is what is happening to my daughter because one of the forms is not available. Her taxes cannot be filed therefore her loan for her new house cannot be funded as required by the underwriters, her sold house has closed escrow now she had to move her belongings into storage and she has to find a place to rent that is in a location with high speed internet for her daily business normally done from her old house, she also has to get the phone lines connected to the rental house as they are used together with her internet work. Meanwhile she is staying in our spare bedroom with four cats and a dog and no internet that is fast enough, here we only have unreliable satellite that is not compatible with her work. This also is affecting the sellers of the house she is buying as they have to keep the payments and everything going. They could even resell the house .So there are far reaching effects of this government blunder. As usual no accountability for there actions.