Tax Return Tips for Last-Minute Filers

When it comes to working on your taxes, earlier is better, but many people find preparing their tax return to be stressful and frustrating and wait until the last minute. Complicating matters this year is tax reform and the newly redesigned Form 1040. If you’ve been procrastinating on filing your tax return this year, here…

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Personal Protective Equipment Qualifies for Deduction

As a quick reminder, the purchase of personal protective equipment, such as masks, hand sanitizer, and sanitizing wipes, for the primary purpose of preventing the spread of coronavirus are deductible medical expenses. The amounts paid for personal protective equipment are also eligible to be paid or reimbursed under health flexible spending arrangements (health FSAs), Archer…

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Coronavirus-Related Distributions and Loans

The Coronavirus, Aid, Relief, and Economic Security (CARES) Act made it easier to access savings in IRAs and workplace retirement plans for those affected by the coronavirus. This relief provided favorable tax treatment for certain withdrawals from retirement plans and IRAs, including expanded loan options. Distributions: Certain distributions made from Jan. 1, 2020, through Dec. 30,…

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Highlights of the American Rescue Plan Act

Signed into law on March 11, 2021, the American Rescue Plan Act (ARPA) contains several tax provisions affecting individuals and families. Let’s take a look: Economic Impact Payments (EIP3). A third round of economic impact payments (EIP3) will be sent to qualifying taxpayers; individuals will receive $1,400 ($2,800 for married taxpayers filing jointly) plus $1,400 for…

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Q & A: The $10,200 Unemployment Tax Break

Generally, unemployment compensation received under the unemployment compensation laws of the United States or a state is considered taxable income and must be reported on your federal tax return. However, a new tax break – in effect only for the 2020 tax year – lets you exclude the first $10,200 from taxable income. Here’s what…

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There’s Still Time To Make an IRA Contribution for 2020

If you haven’t contributed funds to an Individual Retirement Account (IRA) for tax year 2020, or if you’ve put in less than the maximum allowed, you still have time to do so. You can contribute to either a traditional or Roth IRA until the May 17, 2021, due date, not including extensions. Be sure to…

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Avoiding an IRS Tax Audit

Just 0.45 percent of taxpayers were audited in fiscal year 2019. Still, with taxes becoming more complicated every year, there is an even greater possibility of confusion turning into a tax mistake and an IRS audit. Avoiding “red flags” like the ones listed below could help. Red Flags That Trigger IRS Audits Claiming Business Losses…

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Tax Breaks for Families With Children

If you have children, one or more of these tax credits and deductions could help your family reduce the amount of tax owed. Let’s take a look: 1. Child Tax Credit Generally, taxpayers can claim the Child Tax Credit for each qualifying child under the age of 17. The maximum credit is $2,000 per child.…

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Relief for Taxpayers Struggling With Tax Debts

While there have always been payment options available from the IRS to help taxpayers struggling to pay tax debts, the new IRS Taxpayer Relief Initiative was put into place to expand these options and offer relief during the pandemic. These revised COVID-related collection procedures will help taxpayers, especially those who have a record of filing…

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2021 Tax Deadlines

Jan. 15, 2021: Deadline to pay the fourth quarter estimated tax payment for tax year 2020 Feb. 1, 2021: Deadline for employers to mail out W-2 Forms to their employees and for businesses to furnish 1099 Forms reporting non-employee compensation, bank interest, dividends, and distributions from a retirement plan Feb. 1, 2021: Deadline for financial institutions to mail out Form 1099-B relating to sales…

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