Identity theft, health care top this year’s questions

Tax preparers say these categories top this year’s questions posed by taxpayers

Pennsylvania tax preparers offer some advice as April 15 draws closer.

In addition to the usual onslaught of last-minute tax filers who will swarm their offices in the coming days, many tax preparers say identity theft, refund delays and confusion about the Affordable Health Care act are among the top issues they’ve have noticed this year.

Here’s a look at the big issues confronting taxpayers:

Identity Theft

If you filed your taxes early and are still waiting to cash in on your tax return, months after filing, you’re not alone. Tax preparers say they have noticed some of their customers are having to prove their identities to the IRS before getting their much-anticipated tax return.

“We have people that are waiting nine or 10 weeks to get their money,” said Tammy Curran, a tax preparer with Liberty Tax Service.

Curran said the IRS is cracking down on identity theft and is selecting one of every seven tax filings to “grub by hand.”

The IRS has said it is increasing its efforts to prevent identity theft and has stopped 19 million suspicious returns from 2011 to 2014, resulting in over $63 billion in protected refunds.

Curran said she has noticed Hispanics, in particular, are victims of refund fraud.

“When people come over from Mexico, their ID and social [security cards] are photocopied and sold,” she said.

She said her clients have to go to the IRS office and confirm their identities, but as a result of recent IRS layoffs, this process is taking longer than usual.

“People are having to wait three days to talk to anybody down there,” she said.

Affordable Health Care

While the Affordable Health Care has been around since 2010, the 2014 fiscal year is the first year uninsured taxpayers will have to pay penalties.

David Riggs, president of York Accounting Services, said the penalty for not having health insurance for 2014 is not always $95, contrary to what some people believe.

“We’ve seen some shocked faces,” he said. “They don’t hear about the 1 per cent.”

If you weren’t insured last year, you’ll have to pay either 1 per cent of your yearly household income if it’s higher than $10.150, or $95 per person in the household ($47.50 per child under 18), whichever is higher, according to HealthCare.gov.

The maximum penalty per family paying this fee is $285.

For example, Riggs said, if your income is over $50,000, that’s a $500 fine.

The penalties will continue to increase in the following years. Next year, the penalties will be 2 per cent of the household’s income or $325 per person for the year. A family of four with a $60,000 income would pay almost $1,000 for not having coverage in 2015.

Tax preparer Michael Hanscom said some people had no idea the government wants them to have health insurance.

“I had people ask me, ‘Why are you asking me if I have health insurance,’” he said, adding that some people may qualify for a hardship exemption, which exempts people with unusual life circumstances from paying the fee.

STEVE NESIUS — THE ASSOCIATED PRESS William Preus of St. Petersburg, Fla., was covered by the health overhaul for part of last year before transitioning to Medicare, creating a major tax headache for him. As the April 15 tax deadline nears, people who got help paying for health insurance...