The IRS has indicated that it has begun to issue refunds to taxpayers who paid 2020 income taxes on unemployment compensation before the retroactive change that excluded some or all of such compensation for certain taxpayers was enacted as part of the American Rescue Plan. These refunds were discussed in our April 1, 2021 post. The IRS is starting with refunds for single taxpayers and will m...
As discussed in our March 11, 2021 post, the American Rescue Plan expanded the child credit for 2021 and created an advance payment of a portion of the credit for certain taxpayers. Beginning in 2021, the maximum child tax credit is $3,600 per child for children under the age of 6 and is $3,000 per child for children between ages 6 and 17. The higher child credit amounts are phased out when modi...
As practitioners prepare extensions for clients as we approach the upcoming filing due date, it is important to warn clients that such extensions require the use of estimates for amounts that are not yet known. Practitioners should warn clients in writing, indicating that differences between actual amounts and estimates could cause the client to owe additional taxes, including penalties and in...
In addition to individual tax returns being due on Monday, May 17, 2021, calendar-year exempt organizations must also file Forms 990 or a request for extension by the same date. New for this year: Exempt organizations that file Form 990, Return of Organization Exempt from Income Tax, are required to electronically file the return for tax years beginning after July 2, 2019, which is the 2020 ...
