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Coronavirus pandemic in 2021 tax season services

Pandemic changes filing for many people.

2021 tax filing season begins on February 12

The Internal Revenue Service (IRS) announced that the nation’s tax season will start on Friday, February 12, 2021, when the tax agency will begin accepting and processing 2020 tax year returns. The February 12 start date for individual tax return filers allows the IRS time to do additional programming and testing of IRS systems following the December 27 tax law changes that provided a second round of Economic Impact Payments and other benefits. This programming work is critical to ensuring IRS systems run smoothly. If filing season were opened without the correct programming in place, then there could be a delay in issuing refunds to taxpayers. These changes ensure that eligible people will receive any remaining stimulus money as a Recovery Rebate Credit when they file their 2020 tax return. To speed refunds during the pandemic, the IRS urges taxpayers to file electronically with direct deposit as soon as they have the information they need.

Changes because of COVID-19

The tax season can be frustrating under normal circumstances, especially if you’re trying to reach an IRS representative on the phone. But this year may prove to be an extreme exercise in patience. We are going into an unprecedented tax season with a bevy of changes as a result of the novel coronavirus. With the coronavirus pandemic still present during tax season in the U.S., and social distancing becoming the new normal for Americans, many tax preparers are changing the way they do things. Normally, taxes are done person-to-person, but now, we are taking a different approach for safety reasons. Using social distancing as a precaution and safety for everyone is a must.

For this season, we have created a simple 3-step procedure to prepare your taxes safely in time of Coronavirus:

3 SIMPLE STEPS

Step #01

Make an appointment by calling our office, or by messages to our number (908-887-2427) via WhatsApp, or our email:  info@luisfedericop8.sg-host.com.

This appointment is to drop your tax documents and materials, make copies, and update the main data. Don’t worry, we’ve prepared our space in the office, so you can drop your documents in an area that’s about 15 feet from reception desk..

Step #02

We will contact you within 48 hours after receiving the documents, to explain the results, and any new information you need to know.

Step #03

Once the Income Tax preparation process is finished and completed, you will have these 2 options:

1- Make an appointment to sign and find your copies.

2- Send the documents to your email to sign it online, and then receive your copies in your email.

We’ve done all of this in order to be safe and easy for you to complete the process of filing your taxes. Large companies are taking precautions as well. They are encouraging clients to utilize their drop-off services to reduce in-person interactions, bringing in documents and reviewing and approving the return electronically.

Will my Stimulus Check Affect my Tax Return?

If you received an Economic Impact Payment (EIP) in 2020 (also known as a stimulus payment) as part of the Coronavirus Aid, Relief and Economic Security Act (CARES Act), it may affect your tax return for the 2020 tax year. These stimulus payments were advance payments of refundable tax credits from individual 2020 tax returns.

Even though the advance payment was based on your 2019 or 2018 tax return, the payment is earned on your 2020 return. Therefore, even if you didn’t qualify based on your 2019 or 2018 federal adjusted gross income, you may still receive the credit when you file for 2020.

The IRS has stated that the stimulus payment is not includable in your gross income, meaning you won’t be taxed on it. It will not affect the amount you receive in your federal tax refund or the amount you owe. Also, while the stimulus payment is based on your 2018 or 2019 tax returns, there is so far no provision that would require you to pay back the EIP if your tax situation changed in the 2020 fiscal year.

Put in simple words

Anyone who got a stimulus check in 2020 will have to report it on their taxes. However, that money is not taxable income. The reporting is to “reconcile” the payments.

Reconciling on your 2020 tax return can lead to a little more of a stimulus payment. Anyone who was underpaid in their stimulus could get the difference sent to them as part of their tax return. And if you received too much, you won’t have to pay it back.

Unemployment Benefits

Unemployment Benefits are taxable income, and the state you live in will send you a Form 1099-G detailing how much you got and how much was withheld for tax purposes.

It's a Social Media and digital marketing consultant and owner and founder of LFStudio.com. He is also author and entrepreneur. He helps small businesses to grow, get clients and generate income.

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