You’re Not Alone If You Still Haven’t Received Your 2020 or 2021 Tax Return

As we come to the end of another year and start preparing for the 2022 tax filing season, there are more than 6 million taxpayers whose tax returns have not been processed by the IRS. According to the IRS, there are 3 million outstanding individual returns and more than 4 million business returns awaiting initial processing. In addition, there are more than 2 million amended individual and business returns.

Some of those returns include rejects along with about 3 million that are being examined for potential identity theft. And, of course, there’s always the paper returns that pile up included in those figures.

They say that patience is a virtue, but if you’re counting on tax refunds that take years to get to you, frustration probably runs high.

Despite the frustration, you still want to continue filing your federal tax returns even if the IRS is not attending to your returns. At least you’ll stay on their good side and if there are issues that arise with your returns, you will be compliant.

You’re Not Alone If You Invested In FTX Crypto And Lost

You’re in very good company if you find yourself reeling after Cryptocurrency platform FTX declared bankruptcy. According to NPR, “More than a million people may have lost their money in the spectacular collapse of the cryptocurrency trading company FTX.” https://www.npr.org/2022/11/17/1137501882/ftx-investors-are-unable-to-access-their-money-shaking-crypto-investors-confiden#:~:text=More%20than%20a%20million%20people,the%20cryptocurrency%20trading%20company%20FTX

FTX, one of the world’s biggest crypto exchanges, filed for bankruptcy in the US last week after speculation around the financial health of the platform saw a mass of customers attempt to withdraw their funds from the exchange, leading to its collapse.

Among those big losers are Tom Brady, his ex-wife Giselle Bündchen, basketball star Stephen Curry, Shaquille O’Neal, and comedian, Larry David. This rich, stellar line-up will likely not feel the sting from this collapse, but many folks will be devastated by the loss.

According to one article, the same celebrities who were touting the ease of investing in crypto through the FTX platform are being sued. “Now, David is one of the celebrities who has been named as a ‘brand ambassador’ in a lawsuit accusing FTX of using celebs to target “unsophisticated investors” in a “Ponzi scheme” in a bid to keep the platform afloat.” https://www.indy100.com/celebrities/larry-david-sued-crypto-ftx

No Help For Crypto Losers From The IRS

Typically, when market investors suffer losses — or get taken for a ride — they’re often eligible for a tax write-off to soften the blow. However, this does not apply to users of the bankrupt crypto exchange FTX.

Here’s the difference: Let’s say you’re a crypto investor on an exchange that’s still standing. If you’ve suffered investment losses amid the market decline, you can simply sell to offset other gains and potentially take a deduction. That’s because the Internal Revenue Service allows investors to sell poor-performing crypto, just as with stocks, and use those losses to cancel out capital gains from selling better-performing assets. However, the tax code specifies that if you want to take a capital loss, you must sell or exchange that asset. Losing access to it because the exchange shuts down is different and would most likely be insufficient in court.

You’re Not Alone

We’re all familiar with the saying that misery loves company. I’m sure you’ll be able to find someone to sing the blues with whether you’re still waiting on the IRS for your tax refund or if you invested in crypto through FTX.

If you haven’t filed your taxes in a few years, you’re not alone either. Life happens and people find themselves in this position more often than you’d think. If you want to get on the right side of the IRS, we can help you sort things out and get you on the right track. Give us a call.