According to Bill Clark of TaxPro in Corpus Christi, due to the pandemic affecting some income assistance programs, it could mean you could see a smaller refund.
CORPUS CHRISTI, Texas – After another year of battling the pandemic, there are some tax laws that you should know about when you start thinking about preparing your tax return.
Some of the programs designed to provide relief to those whose income has been directly affected by the coronavirus could affect your tax return.
Take, for example, the child tax credit payments that many chose to receive up front last year – six monthly payments of up to $ 300 per child.
According to Bill Clark of TaxPro in Corpus Christi, that could mean you might see a smaller refund.
“Obviously, if I received these funds in advance, I will not receive them on my refund,” Clark said. “I can have them either way, not both ways.”
Clark also said that if your circumstances have changed – say your child is now living with another parent, or you are earning more money than before, you may have received more than you are entitled to.
This is something that you will have to pay back to the IRS.
Another area that may come as a surprise to anyone who has lost their job is unemployment benefits.
If you collected unemployment in 2021, you will have to pay federal taxes. This is something that has been suspended for unemployment benefits levied in 2020.
Either way, Clark says it’s best to file early, in case the sluggishness of last year’s IRS response is duplicated this year.
You might recall that repayments were often delayed and it became extremely difficult to speak to someone live when trying to contact the IRS for help.
“I still do. I spoke to a client yesterday who was going through this and they told me they had been on the phone for an hour and a half and have been disconnected,” Clark said. “That’s just what’s going on. Most of them haven’t come back to the office full-time yet.”
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