It is an undeniable fact that the last thing that we probably pay attention to is taxes; however, taxes are one of the most crucial aspects in every person’s life. Especially in 2021, when the entire world has changed the way of usual operation from head to toe.
For example, there are lots of changes in tax laws which may impact your tax return. But do not worry, since Prestige Auditors are here to tell you about the main changes that you can face during tax filing and answer the most common questions in order to simplify this process for 2021 year.
- When You Should File Your 2020 Tax Return?
The deadline for filing 2020 tax returns is the same as in last year; the only thing that has changed this year is that you have to file your taxes on April 15, 2021.
- The Standard Deduction for 2020 Tax Returns!
Compared to the previous year, the standard deduction has increased by $200 for individuals and in $12,400 for married couples who file jointly. If you want to learn the history of standard deduction in the United States, then you can read this blog.
- About Tax Implications and the Tax Relief!
Nearly 90% of taxpayers who claim for the standard deduction could not deduct charitable contributions following tax returns. However, now they have a unique chance to reduce their taxable income by $300 in contributions, which can be in the form of cash, check or credit card. Try to make sure that you keep all the necessary documentation including receipts and donation letters. Additionally, if you donated more than $250 to one organization, you have to get a letter of acknowledgment from the charity. Keep in mind that if you have donated things like used clothing, you will not be able to deduct them.
Medical Expenses Deductions!
Generally, if your medical expenses are more than 7.5% of your adjusted gross income, you will be able to itemize your deductions. If you are self-employed, then you are eligible to take a deduction for self-employed health insurance deduction on your tax return. Additionally, you can use the advantages of new qualified sick and family leave credit. Find more information concerning this topic in this blog.
- Stimulus Checks and the Recovery Rebate Credit
When you file your tax return this year, you can receive a new credit known as the Recovery Rebate Credit, especially if your 2020 adjusted gross income is smaller than the previous one. Try to make sure that you keep the letter from the IRS and can provide detailed information about your stimulus payments when and if needed.
- Unemployment Benefits
During 2020, due to Covid-19, millions of people have lost their jobs. If you have already received your unemployment insurance, then you have to pay taxes for it. However, if you received less income or reduced work hours, then you can claim for income-based deductions and credits such as Earned Income Tax Credit or the Child and Dependent Credit.
- Business and at Home Deductions!
For those who are self-employed, there are lots of deductions that they can confidently claim. Contact our team and we will help you claim for the most optimal self-employed deductions that you are eligible for.
In most cases, taxpayers are not aware of all tax laws. Unfortunately, this may become a reason for lots of financial loss. With Prestige Auditors, you should not worry about such issues, since we are open to help you claim all the possible tax deductions and credits that you are eligible for. Contact our team and we will get all your questions answered. Additionally, we can help you review, sign and file your tax returns in the speediest way.
Prestige Auditors is always open and ready to help you prepare your tax return. So, if you are confused with figuring out the math of taxes, you should not worry about it anymore, since we at Prestige Auditors are here to help you with every aspect, referring your tax filing process. You can go through our website where you can find the entire list of services provided by our team and read tons of informative blogs concerning taxes.