The Internal Revenue Service said Friday it’s ready to process tax year 2017 returns claiming four additional tax benefits recently renewed retroactively into law, including tax breaks related to energy conservation and production.
The Bipartisan Budget Act that Congress passed last month retroactively renewed for tax year 2017 dozens of tax extenders that had already expired at the end of 2016. The IRS has now reprogrammed its processing systems to handle tax returns claiming four energy-related tax incentives, in addition to several other popular tax extender items that it previously programmed for its systems. The IRS said taxpayers can now file 2017 returns claiming:
• Credit for nonbusiness energy property claimed on Form 5695
• Alternative motor vehicle credit claimed on Form 8910
• Credit for qualified plug-in electric drive motor vehicles claimed on Form 8936
• Credit for certain two-wheeled vehicles claimed on Form 8936
The IRS previously already reprogrammed its processing systems to handle the three benefits most likely to be claimed on returns filed early in the tax season (see IRS ready to process some retroactive tax breaks). Starting last month, taxpayers could also file returns claiming:
• Exclusion from gross income of discharge of qualified principal residence indebtedness (often, foreclosure-related debt forgiveness), claimed on Form 982,
• Mortgage insurance premiums treated as qualified residence interest, claimed on Schedule A, and
• Deduction for qualified tuition and related expenses claimed on Form 8917.
The IRS said it’s continuing to work closely with tax professionals and the tax prep industry to make sure their software can now handle these new provisions. Filing electronically and choosing direct deposit will expedite tax refunds. The IRS is continuing to update its systems to handle tax returns claiming the other tax extenders that were retroactively renewed by the new law, enacted on Feb. 9, but in general, those benefits affect a smaller number of taxpayers. Taxpayers eligible for these benefits can avoid delays or possibly needing to file an amended return later, by filing after IRS systems have been updated to reflect the changes. Check Extenders and Form Updates for future updates. Other affected forms, instructions and publications that the IRS had already released, are being revised and reposted to Download Forms.
Taxpayers who have already filed their 2017 federal tax return and now want to claim one of these renewed tax benefits can do so by filing an amended return on Form 1040X. Amended returns can’t be filed electronically and can take up to 16 weeks to process.