FIT Solutions

2021 Mileage Rate Changes Starting on Jan. 1, 2021, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be: - 56 cents per mile of business travel driven, a decrease of 1.5 cents from the rate for 2020.... - 16 cents per mile driven for medical or moving purposes (for qualified active duty members of the Armed Forces), a decrease of 1 cent from the rate for 2020. - 14 cents per mile driven in service of charitable organizations, remaining unchanged from 2020. You may also have the option of calculating the actual costs of using your vehicle rather than using the standard mileage rates.

Tax Filing Season Start - Did You Know? The IRS has announced that the individual tax filing season will start on Friday, February 12, 2021 and the current deadline to file 2020 tax returns and pay any taxes owed is Thursday, April 15, 2021. Although the IRS systems open for processing on February 12, you do not have to wait until then to begin preparing for your tax return.

Quarterly Estimated Tax Payments - Reminder If you are making quarterly estimated tax payments to the IRS, the due date for the September 1st - December 31st quarter of the year is January 15th. You may be able to skip the January 15 payment if you file your 2020 return by February 1, 2021 and pay all tax due. For payments made using IRS Direct Pay, you can make payments until 8PM EST, and for payments using a credit or debit card, payments can be made up to midnight on the due date.

IRS & Treasury Delivering Second Round of Stimulus Payments Did You Know? Under the Coronavirus Response and Relief Supplemental Appropriations Act, the federal government has authorized a second round of 2020-2021 Economic Impact Payments (EIPs, also called stimulus payments) for many Americans. The IRS has already begun sending these new EIPs by direct deposit and mailed checks. In most cases, individuals with an adjusted gross income (AGI) of $75,000 or below will receiv...e a new EIP of $600. Joint filers with a combined AGI of $150,000 or less will generally get $600 apiece. In addition, many households may receive additional payments of $600 per qualifying child. Those with higher incomes may receive a smaller EIP or no payment at all. Note that dependents age 17 or older are not eligible for EIPs. The vast majority of eligible Americans, including everyone who received a previous 2020 EIP, should receive these new stimulus payments automatically. There is no need to call the IRS or your bank. Simply watch for a direct deposit to your bank account, an IRS check in the mail or, in some cases, a prepaid debit card in a white envelope bearing an official U.S. Treasury seal. For various reasons, some people who qualify for these EIPs may not receive automatic payments. If you believe you are entitled to a payment but do not receive one, a tax professional may help you claim the amount you are owed as a credit on your 2020 tax return.

Some Employees May Still Qualify to Deduct Business Expenses Did You Know? The Tax Cuts and Jobs Act (TCJA) of 2017 eliminated the tax deduction for business expenses for most workers classified as employees. However, some employees may still qualify for a deduction by filing the proper form with their federal tax returns. Eligible school employees may claim the Educator Expense Deduction for up to $250 of unreimbursed expenses necessary for their work, such as classroom su...pplies. Qualifying for this deduction generally requires working for at least 900 hours a year as a teacher, principal, counselor or classroom aide at an elementary or secondary school. In addition, employees in the following categories may qualify to deduct business expenses: - Armed Forces reservists, that is, members of the Army and Air National Guards, along with members of the Army, Navy, Air Force, Marine Corps and Coast Guard Reserves - Qualified performing artists classified as employees, such professional dancers, actors and musicians employed by professional companies - State and local government officials categorized as fee-basis workers (typically, these officials must pay self-employment tax) - Employees with work expenses related to a physical or other impairment These employees may be eligible to deduct unreimbursed ordinary and necessary costs related to carrying on their business as employees. Qualifying expenditures might include travel, costumes, workspace adaptations or office supplies. A professional tax advisor can help you determine whether you qualify to deduct business expenses as an employee, and which forms you must file in order to do so.

'Tis the Season for Important Tax Paperwork Keeping your records organized will help make sure you don't miss out on valuable deductions when it is time to file. Some documents to be on the lookout for:... - Wage and income statements (like W-2 or 1099-MISC) - Health Insurance statements (like Form 1095) - Proof of qualifying educational expenses (like Form 1098-T) - Mortgage interest statements - Retirement distribution statements - Investment account statements - Charity donation receipts