My goal with my newsletters is to share valuable and helpful information. I think you will find the information from local Accountant Falisha Ball very helpful and informative. Please read and share.
Good news, the tax filing deadline has been extended to May 17, 2021 for individuals filing form 1040 and self-employed, LLC owners filing form Schedule C.
Everything has been changing so quickly and still is. And I know it has been overwhelming to keep up with all the news on top of everything else, so I’m writing this email to give you 3 additional changes (that you may not be aware of) that could save you some extra dollars on your taxes
These changes are a part of the new release bill that President Biden just signed a few weeks ago.
CHANGE #1: If you received unemployment last year, you don’t have to pay federal taxes on the first $10,200 of your income.
This includes if you received unemployment payments under the PUA, which covered unemployment payments for self-employed individuals and for independent contractors.
The first $10,200 of unemployment benefits that you received WILL NOT be taxable on a federal level (it could be different for your state, check in with your tax professional to confirm).
CHANGE #2: If you enrolled in the health insurance marketplace/exchange last year and had excess premium tax credits to repay, you WILL NOT owe any of it back for the 2020 tax year.
If your projected income ended up being higher than you reported to the marketplace, that means that you probably have a repayment of a few (if not thousands of) dollars in tax credits.
HOWEVER, under the new American Rescue Plan Act, those do not have to be repaid.
CHANGE #3: If you had to take any time off during COVID as a business owner, (regardless if you had employees or not) you can now receive a credit on your federal tax return that could mean a refund for you.
As a self-employed business owner or Schedule C filer, if you had to take time off from your business because of:
1) a government-mandated shutdown,
(2) you had to care for a child who couldn’t go to school/daycare,
(3) your community was forced to go into quarantine,
(4) you were mandated to go into quarantine because you were exposed to COVID in some way,
(5) you were experiencing COVID symptoms or contracted COVID and had to self-quarantine or be hospitalized, OR
6) you needed time off for vaccination recovery
…you are able to receive a Family Leave Credit on your tax return which if you qualify for just one of the credits, you could be looking at AT LEAST a few thousand in savings (even for those that are self-employed, independent contractors and LLC owners) – and for those of you with employees you could be looking at tens of thousands in relief $$.
Many businesses qualify (regardless of size and if you are an employer or not).
Let me know if you have any questions, we can always set up a consult call and talk through your specific situation to ensure you don’t leave money on the table and get the most out of your tax returns this year.
Please click on link to set up a consult call: https://calendly.com/instachat/discover
Accountant and Tax Strategist
P.S. The IRS reported last week that it is holding $1.3 Billion in refunds for 2017 returns not filed. You must file by May 17, 2021 for 2017 refunds or the money goes to the US Treasury. If you haven’t filed 2020 or have unfiled tax returns for prior years be sure to click here to discuss how I can help you get your taxes completed by the May 17th deadline