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Important 2020 Tax Return Update

Important 2020 Tax Return Update

| March 19, 2021
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To our valued tax clients:

 

We ask for your patience as we do expect delays in processing many returns this year. We are currently awaiting needed IRS forms, tax software updates and additional information. We will contact you if we need additional documentation or your 2020 return needs to be placed on extension.

 

The American Rescue Plan Act of 2021 was passed on Thursday, March 11, 2021, a massive stimulus bill due to the ongoing pandemic. With bills this large and complex, the IRS needs time to interpret the law, issue regulations and instructions. Additionally, Gene Bell & Associates will need time for the tax software providers to update and test their software so we can accurately complete your tax return.

 

The following items are new for 2020, and if missing, may delay the processing of your return and require an extension.

  • If you received the first Stimulus Payment, you will need to provide us with the total amount received (this includes for you, your spouse, and your children). Check your bank statement or provide us with a copy of the Notice 1444 you may have received.
  • If you received the second Stimulus Payment, you will need to provide us with the total amount received. You would have received this payment between December 27th, 2020 and early January 2021. Check your bank statement and provide us with the total payment received.
  • If you received Unemployment Income in 2020, the IRS is currently asking that everyone wait for further instructions. Click here for further information available on the IRS website. 
  • If you made charitable contributions in 2020 in the form of cash, check, or credit card, you are allowed up to a $300 adjustment to your income even if you DO NOT itemize. You are responsible for all documentation to support the charitable contributions should the IRS request such information.
  • Premium Tax Credit: If you received your health insurance from an “exchange” and received more premium assistance throughout the year then you were entitled to, you would normally need to pay back some or all of the advanced payment. However, for 2020, you keep the overpayment, and it is not taxable to you.

 

Additional details on the above changes will be available on our GBA website in the coming days; check back often for the latest changes: genebellassociates.com.

 

Thank you, and we are grateful for the opportunity to support your needs during these ever-changing times.

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