There have been some unprecedented roller coasters in terms of COVID and the economy over the past year, and Jackson Hewitt’s Chief Information Officer Mark Steber noted that the 2020 tax cycle is a reflection of last year.
Between the “more complex tax law changes” resulting from the pandemic and other life changes, Steber said it was something he had never seen. With that in mind, Jackson Hewitt and other tax professionals are prepared and ready to help with the upcoming May 17th tax deadline.
“There is still a lot of time to take care of your taxes – almost a week,” said Steber. “Most good companies will have extra hours and staff. Do not rush or panic as this can lead to errors that may delay your refund. “
Steber warns taxpayers to beware of scammers who promise guaranteed results and anything that is free, such as preparing low tax fees for the next year.
Tax professionals generally don’t offer guaranteed results, Steber added.
“Hobby professionals” are also on Stebers warning list. The expert advised against seeking advice from people who “read the Internet” and instead finding a trained and trademarked tax expert with experience.
“Be careful of someone who has no tax experience but has promising results that most likely will not end in your best interests,” said Steber. Jackson Hewitt’s CIO looks forward to the latest tax reform bill sent to the House Finance Committee. While the law is still just “speculation”, tax professionals will embrace an established platform to “prevent bad people from profiting from” taxpayers. “
The bill, also known as HB21-1311 and HB21-1312, is sponsored by Representative Emily Sirota, Representative Mike Weissman, Senator Chris Hansen, and Senator Dominick Moreno. Sponsors hope the bill will “modernize and increase the equity and efficiency of Colorado’s tax law by doubling its state tax credit (EITC),” according to a state press release.
The sponsors also want to fund the Colorado Child Tax Credit (CTC) and help small businesses through the tax code.
“These bills will increase the income of hundreds of thousands of Coloradans and reduce the tax and administrative burden for thousands of small businesses in Colorado. The legislation also removes some wasteful and inefficient loopholes in state taxation that state analysis shows will not create jobs, stimulate the economy, make Colorado more competitive with other states, or make our state economy fairer, “the news release said.
When taxpayers are in a hurry but don’t currently have the time to file an application, they usually have the option to apply for a six-month automatic extension. This year will be different, said Steber, explaining that the extension is now five months due to the late fees and the extension period of October 15 this year.
“There is this misunderstanding when filing an extension where taxpayers believe they are also extending their payment deadline, which is not true,” said Steber of the extension. While taxpayers have the option to extend their filing, they are expected to pay their taxes by May 17th. Still, there are payment options if taxpayers cannot pay in full immediately.
“If you’re feeling guilty, the IRS has options that range from installment plans to other credit card options,” Steber said, telling taxpayers the main thing not to panic.
Steber also addressed the stimulus reviews of tax forms, which allow taxpayers to reconcile two of the three unreceived payments.
If you haven’t received the first two stimulus checks, consult a tax advisor to make sure they are included on your tax return, Steber advised.
There are several reasons why some taxpayers may not have received their stimulus payments automatically, from moving house to filing for divorce.
“Payment is not automatic so you have to take action by submitting it,” Steber said of the stimulus checks. A survey found that 40 percent of taxpayers considered their payments to be taxable.
“You shouldn’t put your payments on the form as taxable. The IRS is unlikely to intercept and fix this error. “
Taxpayers will also see changes to unemployment laws. According to Steber, around 20 to 30 million taxpayers received unemployment benefits for the 2020 cycle and paid their taxes early. In March, the Taxpayers Rescue Plan Act of 2021 was passed, which exempted $ 2,100 per taxpayer (or $ 2,400 per couple) from taxable unemployment.
While the law is not tax-exempt, it does add a threshold for taxpayers. If taxpayers filed ahead of schedule, Steber said the IRS posted a statement promising to fix that bug for them and mail out a check for the difference.
“You don’t have to go with it alone and you don’t have to worry,” said Steber. “But if you want to go it alone and adventurous, take advantage of the free resources out there.”
Cassie Knust is a contributor to the Montrose Daily Press.
Cassie Knust is a contributor to the Montrose Daily Press.