Pandemic Impact On 2021 Tax Return Season
The upcoming filing season is going to be trickier for most Americans with increased unemployment, working from home, and general financial struggles due to COVID-19.
From a story being reported on by Western Mass News, come January 1, you may never want to think about 2020 again, but either on or before April 15, 2021, you'll have to in order to file your taxes.
Western Mass News spoke with tax expert Paul Federici getting answers on what has changed this year that will both help and hurt you.
“So, there are a lot of different things to keep in mind in terms of 2020 and everything that’s going on. I really can’t see if it’s going to be better or worse,” Burgess, Schultz, and Robb Enrolled Agent and Accountant Paul Federici said.
One of the upsides in your filing will be surrounding stimulus checks seeing as they are non-taxable. You may also still be entitled to one.
“Something on our 2020 tax prep software is that if you did not receive that $2,400 and you are entitled to it, you can take that as effectively tax withholding on your 2020 tax return,” Federici explained.
He also said he sees a possible issue arising in your 2020 filing in the form of unemployment benefits.
“A lot of people were laid off from their jobs. So they collected unemployment quite possibly for the first time. Not only did they collect unemployment, but they also had a $600 bump from the IRS, which is also taxable,” Federici said.
“My clients who contacted me I had them have taxes withheld, but there are people who didn’t have taxes withheld. At the end of the year, that may impact them negatively when they do their tax return,” Federici said.
For more tax answers, explanations, and tips, please check out the original story at Western Mass News' website here and we thank them for the update.
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