This year has been out of the ordinary from every point of view, including taxes. There are some new things you should consider when you file your 2020 tax return. Keep reading to learn more.
Recovery Rebate Credit
You may be able to claim this credit if you met the eligibility requirements for an Economic Impact Payment in 2020 and one of the following applies to you:
- You didn’t receive an Economic Impact Payment in 2020.
- You are single and your payment was less than $1,200.
- You are married, filed jointly for 2018 or 2019 and your payment was less than $2,400.
- You didn’t receive $500 for each qualifying child.
Refund Interest Payment
If you received a federal tax refund in 2020, keep in mind that interest payments are taxable and must be returned on your 2020 federal tax return. Next January, the IRS will send a form to any person who received interest payments of at least $10 during the last year.
New Charitable Deduction
If you don’t itemize your deductions, you can take this year a new charitable deduction of up to $300 for donations made during 2020 to qualifying institutions. If you are interested in this deduction, check out this previous post where we take a closer look at this interesting topic.
Finally, remember that you shouldn’t rely on receiving your refund by a certain date. This is particularly important if you are planning to make a big purchase or pay important bills. While the IRS processes tax returns as soon as possible, some returns require more time, so your refund may take longer than you expect.
More Tips About Taxes
Learning more about taxes is always a smart move, as it helps you avoid fines and missed deductions. Here are some previous posts you may find interesting.
- 4 Steps you can take to start preparing your 2020 tax return
- 3 Tools you need after filing your taxes
- Remember: gift cards are not to be used to make tax payments
- Keep in mind these ideas when you file your taxes
- We debunk 4 common myths about tax returns
- Don’t forget this essential step if you are starting a new business
Contact the Experts at JT Tax Services
Need help preparing your taxes? At JT Tax Services we have the experience, the knowledge, and the drive to assist you. We give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.