Tax Law Changes Delay Start of Filing Season for Some Taxpayers

By Alistair M. Nevius, J.D.

The IRS has warned taxpayers that it will not be accepting certain 2010 individual tax returns until mid- or late February, due to tax law changes enacted by Congress late in 2010 (IR-2010-126). Taxpayers affected include all those who itemize deductions on Schedule A, as well as those who take certain recently extended deductions. These delays will affect taxpayers whether they e-file or file on paper.

The IRS emphasizes that for most taxpayers filing season will start in January, as usual. But because of changes made by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, P.L. 111-312, enacted December 17, the IRS will need time to update forms and to reprogram its computer systems to handle certain items. (For detailed coverage of the act, see Tax Trends, p. 133.)

The change affecting the most taxpayers will be the fact that Form 1040, Schedule A, will have to be updated to reflect the extension of the state and local general sales tax deduction under Sec. 164. The IRS anticipates that it will be the middle or late in February before it can accept Forms 1040 with itemized deductions on updated Schedule A. The IRS also has to update the state and local sales tax tables for use in calculating the state and local general sales tax deduction.

Other individual taxpayers affected by the delay include:

  • Taxpayers claiming the Sec. 222 higher education tuition and fees deduction on Form 8917, Tuition and Fees Deduction;
  • Taxpayers claiming the $250 deduction for elementary and secondary school teachers under Sec. 62(a)(2)(D);
  • Taxpayers filing Form 4684, Casualties and Thefts, to claim casualty or theft losses; and
  • Taxpayers claiming the District of Columbia first-time homebuyer credit.

The IRS also has to update some other forms and its systems, primarily due to changes made by the Small Business and Jobs Creation Act, P.L. 111-240, delaying filing for taxpayers who file those forms. The affected forms are:

  • Form 3800, General Business Credit;
  • Form 5405, First-Time Homebuyer Credit and Repayment of the Credit;
  • Form 6478, Alcohol and Cellulosic Biofuel Fuels Credit;
  • Form 8834, Qualified Plug-In Electric and Electric Vehicle Credit;
  • Form 8910, Alternative Motor Vehicle Credit; and
  • Form 8936, Qualified Plug-In Electric Drive Motor Vehicle Credit

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