5 Tax Considerations to Keep in Mind

A new year brings new considerations for tax season. 

What has changed since last year? What are a few things people often forget about or overlook?

While we still have time to get organized, here are a few details to keep in mind as you prepare to file this year.

Getting started. Gathering essential documents, such as 1099 forms, relevant receipts and proof of charitable donations, can help to ensure that you’re well-prepared for a smooth filing process.

Figuring out deductions. Standard deductions for tax year 2020 have increased to $24,800 for spouses filing jointly and $12,400 for single individuals. If you’re considering itemizing your deductions instead, make sure you’re aware of all that apply to you.

Tax brackets. Each year, tax brackets are adjusted to keep pace with inflation. The adjustments for tax year 2020 could mean you are in a different tax bracket. 

Retirement savings. Newer legislation, like the CARES Act and the Setting Every Community Up for Retirement Enhancement (SECURE) Act, has implications for retirement accounts, which could impact contributions and tax breaks.

Deadlines. April 15, 2021, is the deadline to file individual income tax returns for 2020. If you need a filing extension, you can request six extra months, making Oct. 15 your filing date.

For more information about any of these topics, refer to IRS.gov or reach out anytime with your questions.

As always, we’re here to help you stay on track to meet your goals, even in the face of changing conditions and unexpected events.