Tax accountants are warning clients – this tax season could get confusing

Local News

SPRINGFIELD, Mo.- The Internal Revenue Service (IRS) announced today the 2021 tax filing season begins February 12th and outlined steps to speed up refunds amid the pandemic.

The IRS says the COVID-19 pandemic is causing delays for paper returns sent through the mail, as well as answering phone calls, and issuing returns.

Local tax preparers in Springfield say if you have not gotten one or more of federally issued stimulus checks, it is not too late. The easiest way to ensure you will get it – is filing your 2020 taxes.

Here’s 5 things you need to know about filing your taxes in 2021:

  1. IRS Free File opens today, January 15th
  • 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.
  • Anyone with income of $72,000 or less can file their Federal tax return electronically for free through the IRS Free File Program.

2. File early, and electronically

  • Although the official date folks can file their taxes has not yet been announced, the IRS says it is faster, more secure, and there are fewer mistakes when you e-file.

3. Seniors can now file with Form 1040-SR

  • Form 1040-SR is available as an optional alternative to using Form 1040 for taxpayers who are age 65 or older. Form 1040-SR uses the same schedules and instructions as Form 1040 does.

4. If you have not received a stimulus check(s) – It’s not too late

  • Due to the fact stimulus payments were based on people’s 2018 and 2019 tax returns, if you have a child, lost a dependent, or had a significant decrease in income in 2020, you may be eligible to receive these payments as part of your 2020 tax return.
  • It’s called a Recovery Rebate Credit – and will be an additional document already included in the general 2020 Form 1040 or 1040-SR for seniors.

5. State and federal unemployment payments are taxable

  • You should receive a Form 1099-G, Certain Government Payments showing the amount of unemployment compensation paid to you during the year in Box 1, and any federal income tax withheld in Box 4.
  • When reporting unemployment compensation, be sure to attach the Form 1099-G to your Form 1040 or Form 1040-SR, and include the withholding shown in Box 4 on line 25b.

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