AABS Inc. Personal & Small Business Tax Preparation Services
2021 Tax Filing Season Begins Feb. 12th
To speed refunds and help with their tax filing, the IRS urges people to follow these simple steps:
File electronically and use direct deposit for the quickest refunds.
Check IRS.gov for the latest tax information, including the latest on Economic Impact Payments. There is no need to call.
For those who may be eligible for stimulus payments, they should carefully review the guidelines for the Recovery Rebate Credit. Most people received Economic Impact Payments automatically, and anyone who received the maximum amount does not need to include any information about their payments when they file. However, those who didn’t receive a payment or only received a partial payment may be eligible to claim the Recovery Rebate Credit when they file their 2020 tax return. Tax preparation software, including IRS Free File, will help taxpayers figure the amount.
Remember, advance stimulus payments received separately are not taxable, and they do not reduce the taxpayer’s refund when they file in 2021.
There are several important dates taxpayers should keep in mind for this year’s filing season:
January 15. IRS Free File opens. Taxpayers can begin filing returns through Free File partners; tax returns will be transmitted to the IRS starting Feb. 12. Tax software companies also are accepting tax filings in advance.
January 29. Earned Income Tax Credit Awareness Day to raise awareness of valuable tax credits available to many people – including the option to use prior-year income to qualify.
February 12. IRS begins 2021 tax season. Individual tax returns begin being accepted and processing begins.
February 22. Projected date for the IRS.gov Where’s My Refund tool being updated for those claiming EITC and ACTC, also referred to as PATH Act returns.
First week of March. Tax refunds begin reaching those claiming EITC and ACTC (PATH Act returns) for those who file electronically with direct deposit and there are no issues with their tax returns.
April 15. Deadline for filing 2020 tax returns.
October 15. Deadline to file for those requesting an extension on their 2020 tax returns
It's Not Too Late to Lower Your 2020 Tax Bill -- If You Do This Now
2021 marks the start of a new accounting period, which in and of itself can bring a flurry of confusion to the average taxpayer. Given that we still have a few months until tax returns are due, it’s advisable to think now about how you can lower your 2020 tax liability — even though 2020 has already come to a close.
Retroactively contribute for 2020
Read the fine print
Deduction will work for some, but not for all taxpayers
Make sure to actually make a contribution by April 15
Regardless of the road you take, there is still time to affect the 2020 accounting period.
1. Not filing your return early when you’re due a refund
2. Not reporting all of your income
3. Not knowing your tax credits and deductions
4. Waiting until the last minute to file your return
5. Filing a paper return
The last thing you need is a tax headache. Avoiding these mistakes will take one potential source of stress off the table. Questions? Contact us today! 919-303-3345.