PENNSYLVANIA, USA — Experts say that 2021 could be one of the most complicated years to file your taxes.
Mark Steber, Chief Tax Information Officer at Jackson Hewitt Tax Services, says that between the COVID-19 pandemic, stimulus check payments, the new child tax credit, and more, there's a lot to keep track of.
When first preparing to file, you need to make sure you have all of your normal documentation.
“We’ll get our wage statements, our W-2s, our 1099’s for dividends or interests on that savings account... You’ll get your 1099 brokerage statement for any stocks and stuff," Steber explained.
"But, there’s new things this year that can really trip you up.”
These 'new things' include the third stimulus relief payment from early 2021 and the advanced child tax credit.
If you did not receive this third stimulus payment from the government, you are able to claim that with your taxes this year.
If you are a parent, or had adopted, or fostered a child in 2021, then you are likely able to receive the child tax credit, even if you did not participate in the advanced payments over the past 6 months.
“You would be able to claim it now, on your 2021 taxes, so your refund would be boosted that way," says Michael Hanscom, Owner & Operator of Michael Hanscom Tax and Financial Services in West Manchester Township.
Another important change this year is that unemployment payments will be taxed, unlike in 2020.
It’s important to stay aware of these changes and credits as they apply to you, as Steber says the IRS will not double check for you.
“Leave it off, it’ll stay off, as with most tax benefits. Forget about it, it doesn’t get caught on the back end by the IRS... They’re just not in that business," Steber says.
When it comes to getting your most accurate return, Steber has three tips.
“Be involved. Find someone with tax knowledge. And then use technology. And be engaged all year round, as kind of a footnote, it’s not just an April 15 thing, which by the way is April 18 this year... it’s a year round thing to pay attention to if you want the biggest refund you can get.”
The IRS has not yet released when you can start filing this year, though Steber anticipates it will open sometime in January.
Steber also reiterated that the sooner you file your taxes, the sooner you will get a return.