Tips on how to keep away from a tax submitting rejection if final yr’s return is pending


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The IRS is backlogged and nonetheless sifting by means of tens of thousands and thousands of pending returns, together with lots of final yr’s filings. In case your 2020 return is a part of the pileup, there is a particular step in your 2021 digital submitting.

The company processed greater than 61.9 million returns as of March 11, with the bulk filed digitally and roughly half self-prepared, the IRS reported.

If you self-prepare electronically, the IRS validates your submitting with the earlier yr’s adjusted gross revenue. Nonetheless, there is a totally different course of for the thousands and thousands of filers with a pending 2020 return.

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If final yr’s return continues to be in limbo, you will must enter $0 in your 2020 AGI when submitting on-line, mentioned Nationwide Taxpayer Advocate Erin Collins in a listening to with the Home Methods and Means Oversight Subcommittee.

“That approach you may file electronically, and you do not have to file a paper return,” she mentioned. “We have to get that message out to taxpayers.”

Whereas these instructions solely apply to digital filers, the company urges everybody to file electronically with direct deposit to keep away from delays.

Almost 94.3% of particular person tax returns had been filed electronically throughout the fiscal yr 2020, in accordance with the IRS.

And there are related directions for non-filers, who sometimes embrace sure Social Safety recipients or these with yearly revenue beneath the usual deductions.

If you happen to used the non-filer software in 2021 to gather the advance youngster tax credit score funds or your stimulus test, the IRS says to place $1 for final yr’s AGI.  

“I’d assume hardly anyone is aware of about that one,” mentioned licensed monetary planner Larry Harris, director of tax companies at Parsec Monetary in Asheville, North Carolina.

If you happen to do not comply with these directions, the IRS could not settle for your digital return, mentioned Tommy Lucas, a CFP and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.

“We have seen that from people attempting to file themselves,” he mentioned, explaining how AGI conflicts could set off a complicated rejection e-mail from their tax-filing software program.  

Lacking 2020 returns

Your return may be pending in case you acquired a CP80 discover a few lacking 2020 return.

If you happen to acquired this discover and it nonetheless hasn’t been accepted, it’s best to enter $0 in your 2020 AGI when submitting this season, mentioned Lucas.

“They are going to present $0 of their system, so that is what I’d begin with,” he mentioned. 

But when the IRS rejects your return with a 2020 AGI of $0, they could have processed final yr’s return after sending the discover, Lucas mentioned, which means you may refile your 2021 return together with your precise 2020 AGI.

Whereas it might be tough to achieve the IRS by telephone, you may double-check the standing of your 2020 tax return by downloading a free IRS transcript out of your on-line account.



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