Blogging Beyond the Numbers

As many have heard, the 2020 individual income tax filing deadline was moved to May 17, 2021. This deadline is fast approaching, and it is important for individuals to have a good handle on their current tax situation. Any potential tax liability for 2020 must be paid by May 17, 2021 to avoid penalties imposed by the IRS. Here are the basic rules. Failure to pay  Separate penalties apply for failing...

In recent months, there have been several tax changes that may affect your individual tax bill. Many of these changes were enacted to help mitigate the financial damage caused by COVID-19. Some unemployment compensation from last year is tax free. Generally, unemployment compensation is included in gross income for federal tax purposes. The American Rescue Plan Act (ARPA), enacted on March 11, 2021, ...

Internal Revenue Service announced that the federal 1040 income tax filing due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021 to May 17, 2021.  Federal balance due amounts are also moved to the new due date of May 17, 2021. Most states, including Wisconsin, also followed the IRS due date change so 2020 state individual tax returns and state tax balance...

An individual’s filing status determines the rate they are taxed and their allowable standard deduction. The head of household filing status, generally, allows for a lower tax rate and a higher standard deduction over single tax filers. Head of household may be beneficial to individuals who meet the following qualifications: Unmarried or considered unmarried (legally separated) the last day of tax...

The child and dependent care credit has been available to taxpayers for a while but for 2021 tax year, the New American Rescue Plan Act (ARPA) has enhanced this credit. The credit is available for expenses that a taxpayer pays for the care of qualifying children of age 12 and under so the taxpayer can be gainfully employed. The 2021 credit is refundable if either the taxpayer or their spouse has a principa...

The American Rescue Plan Act, signed into law on March 11, 2021, hopes to provide a variety of tax and financial relief to Americans to help mitigate the effects of the COVID-19 pandemic. Among the many initiatives are advance tax credit payments that will be made to eligible individuals and parents. Below are some answers to common questions about these payments. What are the two types of payments? ...

Normally April 15 is the deadline for filing your individual tax return  (except for 2020 taxes that are now due on May 15, 2021), it’s also the deadline for the first quarterly estimated tax payment for both Federal and State for 2021, if required. You may have to make estimated tax payments if you receive interest, dividends, pension/IRA income, self-employment income, capital gains, prize money or...

Are you approaching retirement? If you are, then you will probably want to ensure that the money you have saved in retirement plans lasts for as long as it possibly can. Be aware that a law was recently enacted that makes significant changes to retirement accounts. The SECURE Act, which was signed into law in late 2019, made some changes of interest to those nearing retirement. You can keep making tradi...

More and more people are working from home, especially during the COVID-19 pandemic.  If you spend time working at home, you may wonder whether you can deduct expenses related to your home office space. Unfortunately, if you are an employee of a company, the Tax Cuts and Jobs Act suspended the business use of home office deductions from 2018 through 2025 for employees. Those who receive a paycheck ...

Although we still do not see as many electric vehicles (EVs) as cars on the road today, they are increasing in popularity all the time. And what many people do not know, if you buy one, you may be eligible for a federal tax break in the year you place the EV in service. The tax code provides a credit to purchasers of qualifying plug-in electric drive motor vehicles including passenger vehicles and light...