Filing Your 2021 Taxes

You need to be mindful of some issues when filing your 2021 tax return. Some of the issues include when taxes are due, potential delays in receiving refunds, Third Economic Impact Payments. Child Tax Credits, standard deduction versus itemizing, education benefits, and Paycheck Protection Payment loans. If your tax filing may be at least somewhat complex, you may wish to seek a tax professional to avoid over payment.
Some facts you need to know, especially if you expect a tax refund, include:
• Returns this year are due on or before April 18, 2022. If you file your return electronically and sign up for a direct deposit, you will have the best chance of receiving your return within 21 days. However, the IRS warns that receiving returns may take longer, especially if you file a paper return.
• Taxpayers who didn’t qualify for a third Economic Impact Payment or received less than the full amount may be eligible to claim the Recovery Rebate Credit. If you received some money, you must correctly calculate your rebate credit to avoid delays in processing your refund.
• Your Stimulus checks do not count as taxable income.
• You can check the status of your refund at IRS.gov.refunds.
• Concerning child tax credits, you should read IRS letter 6419 to ensure you file accurately to avoid a delay in receiving your return.
• You may need to carefully consider whether you would pay less tax if you claim the standard deduction versus itemizing. The standard deduction has increased to $12,550 for single filers and $25,100 for married couples filing jointly.
• You may be able to receive a tax break if you or a family member(s) was a student for the first four years of college.
• For business owners, Paycheck Protection Plan loan expenses may be deducted from your income. However, you must first have your loan forgiveness application approved by the Small Business Administration.
Tax planning is the key to lowering your tax obligations. We provide unlimited complimentary tax planning to our clients. If you have questions concerning your tax return, including whether you should hire a tax professional, contact our office.
Professional Tax Services is a locally owned provider serving over 3,500 local residents and businesses. For more information, call 661-259-1967 or visit www.protaxservices.com. Through their complimentary EZ2 Thrive program, they provide unlimited free tax planning advice to their clients.