The good news is that Congress moved the date your tax returns are due to May 17, 2021! ***
The bad news is that you are still sorting out your tax return documents and haven’t filed yet or even sent the documents to your accountant!
2020 was a year. You may be wondering, are there any special documents and information that I need to provide to my accountant to prepare my taxes? Here are a few reminders of documents and information you need to gather for your accountant:
- Home office deduction: Did you change jobs during the pandemic? Are you now a self-employed or an independent contractor working from home? If so, while gathering your tax preparation documents, include your expenses for your business use of home as well as any improvements made to your home.
- Estimated Payments:. If your income did not include federal and state withholding, you may have scheduled monthly or quarterly estimated tax payments. When submitting documents to your accountant, make sure to include the jurisdiction, amount, and date the estimated payment was made.
- Interest Income: 2019 tax filers who had a refund on their tax returns may have also received interest income from the IRS. (Due to delaying Tax Day from April 15 to July 15 due to the COVID-19 pandemic.) Interest payments are taxable and interest must be reported on the 2020 federal income tax return. (Minimum $10.)
- Charitable donation deduction:. The CARES Act allows taxpayers who file using the standard deduction to claim a limited deduction for cash contributions to qualifying organizations. The deduction cannot exceed $300. (Donated property cannot be deducted.)
- Economic impact payment(s): Include the amount of economic impact payment (EIP) provided by the COVID-related tax relief act of 2020 in your tax preparation documents.
- Paycheck Protection Program loans (PPPL): Make sure to let your accountant know if you received a first and if applicable second round PPPL.
2020 was an extraordinary, and confusing, year for American taxpayers. We recommend that individuals and business owners consult an accountant for their tax preparation so they get all they deserve for the year most of us want to forget.
A.K. Burton, PC, can do all your individual and business tax preparation. We have experienced accountants who can prepare and file your tax return and represent you before the IRS. Call us at (301) 365-1974 for a consultation. Our office is open. At this time we are not providing in-person services because of the pandemic. We serve the Bethesda, Rockville, and Montgomery County, MD area.
*** See the IRS website for updates on the new tax return due date for 2021.