It's always wise to get a jumpstart during tax season! The earlier you prepare and get organized, the less you'll have to stress about when you file. This year, there are important changes to the tax policy that you'll want to be aware of when it's time to file your return.
Single - Standard Deductions increased from $12,400 to $12,500 in 2021.
Married (Filing Jointly) - Standard Deductions increased from $24,800 to $25,100
Married (Filing Separately) - Standard Deductions increased from $12,400 to $12,500
Head of Household - Standard Deductions increased from $18,650 to $18,800
The Pandemic and Your Taxes
Unemployment Benefits - While the first $10,200 of unemployment benefits were made tax-free in 2020, this does not apply in 2021. So plan to pay taxes if you were unemployed in 2021 and did not have taxes withheld from your unemployment payments.
Paycheck Protection Program (PPP) Loans - In an effort to help small business owners stay afloat, the government offered them Paycheck Protection Program (PPP) loans. These loans will be fully forgiven as long as they were used for payroll costs, interest on mortgages, rent and/or utilities.
Stimulus Checks - Good news: If you received a stimulus check, it does not count as taxable income.
April 18, 2022 - Deadline to file and pay taxes or request an extension.
October 18, 2022 - Last day to file a tax return if you received an extension from the IRS. More details on extension filing and daily deadline updates is available at www.irs.gov/newsroom/help-for-taxpayers-and-tax-professionals-special-filing-season-alerts.
If you have any questions or need assistance, give me a call. I can connect you with a trusted and skilled tax professional in my network. I'm here to help you get a head start to make filing a breeze this spring!