Hope everyone is doing well and safe during this Pandemic time. With your unconditional support, we were able to finish the last tax season without any serious issues. Majority of you either mailed or emailed your documents and I thank you for that. I just want to let you know that for the 2021 tax season, due to PANDEMIC related restrictions and issues, we are forced to work from our Cottman Ave office only. So, our operations in Malvern and Maryland are suspended for the 2021 tax season.
Kindly mail, e-mail, or Fax your 2020 tax documents to us early and we will gladly process it. If you are mailing documents, please keep a copy for yourself and notify us before mailing.
WHAT IS NEW IN 2020 TAX YEAR (2021 TAX SEASON)
Standard deduction: Increased to $12,400.00 for single filers, $18,650.00 for head of household and $24,800.00 to married filing jointly. In addition if you are taking standard deduction, starting this year you can take an above line deduction of $300.00 towards donation (if you paid-need receipts) which will reduce your adjusted gross income. STIMULUS PAYMENT If you received stimulus payment in 2019, it is an advance payment of a special 2020 tax credit which will be reconciled on your 2020 tax return. Taxpayers who received less payment can claim the entitled balance amount on 2020 return. We expect you will not have to repay the IRS if the payment you got is more than the credit
RMD (Required minimum distribution at the age of 70 1/2) Under the SECURE ACT the beginning age for RMDs rises from 70 ½ to 72. The Cares act also allows seniors to skip their RMDs in 2020 without penalty. CARES ACT also allows people who have a baby or adopt a baby in 2020 to withdraw $5,000.00 from IRA/401K without 10% penalty. The act also waives 10% penalty for up to $100,000.00 from IRA/401K for Coronavirus related payouts. You can repay this amount in three equal installments over a three-year period or pay the tax in three years.
NEW IRA/ROTH IRA CONTRIBUTION and 401K/403B/457B CONTRIBUTION LIMITS. IRA/ROTH IRA: Minimum contribution is $6,000.00 per person and catch-up contribution is $1,000.00 each for individuals age 50 and up. 401K/403B/457B $19,500.00 for individuals and additional contribution of $6500.00 for people age 50 and up.
IRS/STATE RELATED MATTERS/DEADLINES
Estimated Taxes: If you owe taxes to IRS for 2020 you must pay it in advance (Estimated Payments) to avoid late payment penalty. IRS is extremely strict now. Please be in touch with our office via email and we will send you ESTIMATED COUPONS in your email. If you have affordable care act, then you will get a 1095-A form and we need that form to file your taxes. Individual taxes are due by April 15, 2021. Partnership and S corp. taxes are due by March 15, 2021. C corp. taxes to be filed by April 15, 2021. For businesses W2 and 1099 forms (Non-employee compensation) must be filed by January 31, 2021 (Late filing penalty will be imposed in all cases if you miss the deadlines). Please email us your business bank statements, cancelled checks and credit card statements ASAP but no later than January 25, 2021)
Cottman Ave office hours are Monday -Saturday 10:00 AM – 8:00 PM and Sunday 2:00 PM to 6:00 PM. For in house tax preparation, please make an appointment and every one must wear a mask. Two people max at a time. Also, you can drop off and pick-up documents at your convenience during office hours.
SCAM CALLS AND E-MAILS: IRS, SOCIAL SECURITY OFFICE OR STATE OFFICES WILL NEVER CALL YOU!!!!
Please work remotely with us for every one’s sake as much as possible!