Translations from Your Trusted Advisor.
In an update to a recent blog post, the IRS has now sent out most of the Advance Child Credit Letters to taxpayers that received advanced child tax credit payments. It is important to note that taxpayers that file as married filing jointly will each receive an Advance Child Tax Credit Letter. Each letter will report a portion of the total amount. In many instances each letter will report half of the total amount, but there are situations where the amounts will be different, so it is important to provide the total amount that was received to your accountant.
Brenda Quinn, EA •
Your tax professional will ask you if you own, buy or sell cryptocurrency. The IRS wants to know too and now the question appears on the front page of the 2021 Form 1040! Cryptocurrency is a virtual currency that is quickly gaining widespread acceptance throughout the world.
Rebecca Acorn, CPA, MST •
Earlier in October, the Internal Revenue Service issued News Release 2021-217 on steps taxpayers can take to make tax filing easier in 2022.
The first step the IRS recommends is gathering and organizing your tax records. Your Mason & Rich tax organizer, which we starting sending yesterday, can be an important tool in helping you gather your tax documents. It lists the tax documents provided last year and asks questions that can help identify new documents.
Rebecca Acorn, CPA, MST •
In December 2021 the United States Department of Education announced that the COVID-19 Emergency relief related to federal student loans would end on May 1, 2022. Those with eligible loans may have received a suspension of loan payments, 0% interest rate, and stopped collections on defaulted loans. To learn more about repayment restarting, visit your loan provider or Studentaid.gov
Yesterday the IRS released News Release 2021-255 where they shared that tax payers will be receiving certain information letters beginning in December and through January. You should keep an eye out for these letters if you received the related benefits as your accountant will need the information for your 2021 tax return.
Mallory Vincent, MBA •
With the holiday season approaching, tis the season for spreading kindness and being charitable. During the coronavirus pandemic, even more people and animals are in need, but many not-for-profits are struggling. By making a donation and giving a gift to charity, you are helping out others and spreading holiday cheer. This act of kindness could also be a great tax write-off, and in 2021 everyone will be eligible to receive a charity tax deduction on their tax return. Read on to learn some tips on how to make your donation count as a tax benefit on your 2021 tax return.
Late last Friday the House passed the Infrastructure Investment and Jobs Act, the Senate had passed the bill back in August. While there are few immediate tax provisions in this bill, it opens up the way for the reconciliation bill, the Build Back Better Act, which has significant tax impacts.
Tax impacts related to the Infrastructure Investment and Jobs Act:
Yesterday, the IRS released Notice 2021-61 which provides cost of living adjustments for retirement plans for 2022.
401(k), 403(b), most 457 plans, and Thrift Savings Plan contribution limits have increased $1,000 to $20,500. The annual catch-up limitation for employees over age remains unchanged from 2021, at $6,500.
Alyssa Hodges, CPA •
The tax deadline has come and gone for most taxpayers with a few exceptions for unusual events like federally declared disasters. If you missed the tax deadline you need to get caught up, but it’s probably not the end of the world.
Yesterday, the Social Security Administration issued a press release with updates for 2022 including updating their fact sheet.
The updates include:
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