Federal Income Taxes

[jmjm5353]

I have been looking at IRS.gov/Where'sMyRefund? every week since May 3, when my tax return was filed.  This week I got an answer that said "You do not get a refund. Instead you owe us $3118 in Federal Income Tax. We will send you a letter about this on August 9."

Why are they taxing 100% of my total income? Even my Social Security?

I found a button labeled "Transcript" which showed me the figures TurboTax put onto the 1040 form and comparing those numbers with what the IRS would have put in.  They put $0.00 for Standard Deduction. For Schedule A, they put only $1723.00 in deductions, which they did NOT put toward my tax liability.

Why am I paying taxes on 100% of my income? Including my Social Security?

Why did they put $0.00 for Standard Deduction?

Why did they NOT allow Charitable Contributions on my Schedule A?

[Bsch4477]

There are some situations where the law does not allow a person to claim the standard deduction. This rule applies if the taxpayer is married filing a separate return and their spouse itemizes. In this case, the taxpayer's standard deduction is zero. 

[jmjm5353]

I filed Married filing Separately.  My spouse did not file at all.  If he had filed, he would NOT have used Scheduled A since he has absolutely no deductions.

[VolvoGirl]

May I ask why you didn't file a Joint return?  Did he have any income?  Even if he only gets Social Security he has to file his own MFS return for it.  

The IRS must think he filed and took Itemized Deductions.  

[Opus 17]

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@jmjm5353 wrote:

I filed Married filing Separately.  My spouse did not file at all.  If he had filed, he would NOT have used Scheduled A since he has absolutely no deductions.

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More information is needed.  You may just have to wait for the letter.  Even if your $12,400 deduction was denied AND the IRS did not give you credit for any itemized deductions, you would have to be in the 32% tax bracket or higher for you to have more than a $3000 swing in your tax liability.  Maybe they changed some other things as well.  

Regarding schedule A, if you claimed the standard deduction, you never filed a schedule A, so the only thing the IRS can put on schedule A is state and local income taxes, that are shown on your W-2.  The IRS doesn't know about and can't guess about your charitable deductions or personal property or sales tax, and even though they IRS may have information about your mortgage interest and property taxes, they don't know that you actually paid them (instead of someone else) unless you report them yourself.

If it turns out your spouse did file, and did itemize their deductions, then you are disallowed from using the standard deduction.  In this case, you can respond to the letter by indicating that you had more itemized deductions than the IRS credited you with, and prepare an amended tax return showing the new amount you owe, and pay that amount along with sending the amended return and a letter of explanation to the IRS office that sent you the adjustment notice.

If you are 100% sure your spouse did not file or did not itemize, you can try to appeal.  You would probably need a signed affidavit from your spouse and a copy of their tax return to send with your appeal letter.  It could also be that your spouse itemized by mistake.  In that case, your spouse will want to file an amended return to change to the standard deduction, and you would send a copy of the amended return to the IRS with a letter of explanation.

[Opus 17]

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@jmjm5353 wrote:

I filed Married filing Separately.  My spouse did not file at all.  If he had filed, he would NOT have used Scheduled A since he has absolutely no deductions.

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If you are in communication with your spouse, start by asking to review their transcript. 

[TomD8]

I suggest waiting until you receive the letter from the IRS.  Then post back if you don't understand or don't agree with their explanation.  Everything is speculation until you see the letter.

[jmjm5353]

Thanks. I hope the letter does not take months.  They have already assessed a "Late Fee" and interest is already accruing.  I guess somebody gets a bonus for these extra fees. Lucky them 😘

[jmjm5353]

My spouse did not file taxes. His taxable income is less than $6000 annually

[jmjm5353]

No joint return because we are now divorced as of January 2021

[jmjm5353]

I used TurboTax. If they checked Standard Deduction, then the mistake is theirs.  I filed a Schedule A with over $20000 deductions, including charitable contributions. Spouse did NOT file a return because he was told by a tax expert that since his taxable income is less than $6000 annually, he did NOT have to file a return.

[jmjm5353]

He does not have a transcript since he did NOT file.  He had less than $6000 taxable income for 2020.  The tax expert he contacted said that he did NOT have to file with that amount.

[jmjm5353]

I understand. Thank you!

[Opus 17]

@jmjm5353 

If you did file schedule A and itemized, but the IRS has disallowed most of those itemized deductions, you will have to wait until you get their letter of explanation.  I can’t think of any reason in the tax code that would allow them to automatically disallow your itemized deductions without performing an audit. If your spouse had filed and used the standard deduction, the fact that you itemized would have forced your spouse to itemize, not the other way around.

Did you print and mail your tax return? Maybe the data entry operator who punched in your numbers lost the page with schedule A printed on it, so they could only give you credit for your income taxes and not the other items.

You should have the opportunity of filing an amended tax return to correct the situation. You may have a 30 day deadline once you receive the letter, make sure to read the letter carefully. You can also contact the office of Taxpayer Advocate.

https://www.irs.gov/taxpayer-advocate