As 2021 comes to a close, tax experts recommend you start preparing for tax season.
Tax season changed a lot last year due to the pandemic. This year, the restructuring of taxes continues.
Local tax expert and business owner, David Kembel, said year-end planning is always important and with recent adjustments and the possibility of more to come, he said we could continue to see more changes.
“2020 we phrase as the worst tax season ever. Mainly dealing with stimulus …the 2020 returns we are reconciling those payments and did you get the right amount. So now 21 is going to be the same thing,” said Kembel.
A big change comes from the American Rescue Plan. It boosted child tax credit to $3,000 for families with kids 17 and under for 2021. With an extra $600 for children under the age of 6.
However, most people have received advanced tax credits.
”Somebody who has one kid that is over six, would come in at tax time and we would see that the credit is $3,000, but you already got $1,500 of it so now you are going to get the other $1,500,” said Kembel.
When it comes to getting your tax refund as quickly as possible, the best thing to remember is to say organized and keep up with all your mail coming in January. You will want to keep an eye out for your child tax credit letter and your stimulus letter. This way all amounts are correct. The IRS will be sending you a letter called the 6419, which documents what you’ve received thus far from the Advance Child Tax Credit payments. Notice 1444-C will be hitting your mailbox in January as well. This letter will show how much of the third stimulus payment you received.
Also, remember to be patient this tax season. There are a lot of changes still happening and refunds will likely be delayed. Direct deposit is the quickest way to get your refund, but make sure you provide the correct bank information.