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As a small business owner, you know more than anyone the importance of perseverance and hard work in spite of difficult times. Tax season is here and the challenges for small businesses will continue. We file tax returns and perform accounting services for small businesses of many different backgrounds, income levels, and filing complexities. We make sure that no deductions or tax strategies are missed.
The IRS announced that the official federal e-file start date for tax year 2020 will be February 12, 2021.
The 2021 tax season has begun. Accepting new clients. If you have any tax questions, contact Green Hill today.
Important Due Dates for Filing Your 2020 Tax Return and Payments
If you are new to becoming a home daycare, you need to make sure that you are familiar with the Time/Space Percentage calculations (T/S%) for the home office deduction. This is one of the most important calculation for home daycare businesses.
As the COVID-19 outbreak continues to develop, many professional services become more difficult to get done in person. I am a local CPA that can work with you completely remotely to file your tax return. I file for individuals and small businesses. I am very detailed and work to help you tax most efficiently. I answer questions all year long and would love the opportunity to build a relationship with you and be your "tax guy".
The deadline for personal tax returns is this Wednesday, July 15. If you still need more time to file, contact Green Hill today to file an extension. This will give you until October 15 to file your tax return.
Economic Impact Payments are coming soon.
Eligible individuals with adjusted gross income up to $75,000 for single filers, $112,500 for head of household filers and $150,000 for married filing jointly are eligible for the full $1,200 for individuals and $2,400 married filing jointly. In addition, they are eligible for an additional $500 per qualifying child.
If you are using a different bank account than the one used for your most recent Federal tax filing (or did not use a bank account), now is the time to make sure the IRS has your correct direct deposit information.
The IRS is introducing a new tool to update direct deposit information. It is not live yet, but will be available mid-April at the following link:
https://www.irs.gov/coronavirus/economic-impact-payments
We’re committed to helping yout get your economic impact, or stimulus, payment as soon as possible. See if you are eligible for an Economic Impact Payment.
Update: The tax filing due date is extended from April 15 to July 15. All taxpayers -- individuals, corporations, other non-corporate filers and those who pay self-employment tax -- can also defer income tax payments. See details at: www.irs.gov/coronavirus
Because the deadline for financial institutions to mail out Form 1099-B (relating to sales of stock, bonds, or mutual funds through a brokerage account) falls on a weekend and Monday is President's Day, the due date is now Tuesday, February 18. For most people, this will be the final document they are waiting on in order to file their tax return.
Any questions on your 1099-B, call GHFS at 703-828-7074.
Here is a quick list of things you might be able to deduct on your tax return:
Business expenses (must be ordinary and necessary)
Student loan interest
Traditional IRA contributions
HSA contributions (other than those paid through your employer)
Charitable contributions
Medical expenses more than 10% of your AGI
Mortgage interest
Gambling losses to the extent of gambling winnings
State and local income taxes withheld
State and local estimated payments
State and local payment sent in the tax year for a prior-year return (not including penalties or interest)
Real estate taxes
Personal property taxes
State and local sales taxes (instead of state and local income taxes, if it’s more helpful)
Estate tax paid because of someone’s death
Income taxes paid to a foreign country or U.S. possession
Half of any self-employment taxes paid
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With the start of the 2020 tax filing season, IRS wants to remind you to avoid unethical "ghost" tax return preparers.
A ghost preparer doesn’t sign a tax return they prepare. They will print the return and tell you to sign and mail it to the IRS. For e-filed returns, the ghost preparer may refuse to digitally sign as the paid preparer. If a preparer refuses to sign your return, that is a red flag.
To learn more about how to avoid ‘ghost’ preparers, click here: https://www.irs.gov/newsroom/irs-dont-be-victim-to-ghost-tax-return-preparers
Tax Trends at the Dawn of 2020
https://taxfoundation.org/2020-tax-trends/
Long-term state tax trends, like the declining importance of corporate income taxes, will continue to figure into states’ tax considerations.
Summary of Tax Law Changes for 2020
https://www.cpapracticeadvisor.com/tax-compliance/article/21116392/tax-reform-and-beyond-tax-law-changes-for-the-2020-tax-filing-season
As you know, the Tax Cuts and Jobs Act (TCJA) was signed into law in 2017. Most of the measures were effective beginning in tax year 2018, and many individual measures contain a sunset date at the end of 2025. Here’s a summary of the TCJA provisions ...
State Tax Changes as of January 1, 2020 to know about.
https://taxfoundation.org/2020-state-tax-changes-january-1/
Thirty-four states have major tax changes taking effect on January 1, 2020. Explore a comprehensive guide of 2020 tax changes and 2020 state tax changes.
Children can be claimed as a dependent on your taxes. To qualify as a dependent, the child must:
- Be under age 19, a full-time student under age 24 or permanently and totally disabled;
- Not provide more than one-half of the child’s own total support; and
- Live with you for more than half of the year.
https://www.consumeraffairs.com/news/here-are-some-key-tax-changes-taking-effect-in-2020-010220.html
Here are the tax brackets and income limits for the 2020 tax year for a married couple filing jointly:
10 percent - $19,750 or less
12 percent - $19,750 - $80,250
22 percent - $80,250 - $171,050
24 percent - $171,050 - $326,600
32 percent - $326,600 - $414,700
35 percent - $414,700 - $622,050
37 percent - $622,050 and above
With the arrival of a new year, many consumers will already be preparing to file their 2019 federal tax return. But it could pay to be aware of tax changes
Owning your own small business can be costly. Be sure to take advantage of all your deductions. When you use a car for business, you may deduct the mileage expense by using either the standard mileage rate or the actual expenses of maintaining the vehicle. If you take the actual expenses, you can deduct the depreciation, gas, oil, insurance, tires, licenses, repairs, etc. The standard mileage rate for the use of a car during 2019 is 58 cents per mile for business miles driven.
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This tax filing season the IRS urges you to combine e-File with Direct Deposit this year for your tax refund. It’s the best and fastest way to get your tax refund directly to your bank account. Eight out of 10 taxpayers get their refunds by using Direct Deposit. It is simple, safe and secure. To learn more, click here: www.irs.gov/directdeposit
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Selling your home? When filing your taxes, you may qualify to exclude all or part of any gain from the sale from your income. Learn more about that process and other things you should think about when selling a home: https://www.irs.gov/newsroom/tax-tips-for-taxpayers-to-consider-when-selling-their-home
Only 3 weeks left to file! Need more time? File an extension with Green Hill.
Guaranteed filing by April 15 if documents are recieved by April 1st!
Most of the talk about the 20% deduction for "pass-through" income has centered on partnerships, LLCs, and S-corps that flow to an individual's tax return. However, the deduction is also available for qualified business income from a sole proprietorship.
The child tax credit for qualifying children under age 17 is doubled to $2,000 starting in 2018, and the phase-out threshold is raised to $400,000 for MFJ, and $200,000 for all other taxpayers. In addition, there is a new $500 credit for any dependent who isn't a qualifying child under age 17.
The itemized deduction for state and local taxes is limited to $10,000 of the aggregate of state and local property taxes and state and local income taxes.
Alimony rules have changed for divorce and separations that are executed after 2018. Alimony payments will not be deductible by the payer, and will not be considered income to the recipient. Therefore, the recipient will not owe federal income tax on alimony payments. If a pre-2019 divorce or separation agreement is modified, it is possible to incorporate the new rules.
The deduction of $4,150 for each personal exemption has been eliminated. If you have dependent children, you may now qualify for a higher child tax credit.
Starting in 2018, no deduction is allowed for moving expenses, and employer reimbursements are no longer excluded from income.
The threshold for the medical expense deduction is reduced to 7.5% from 10% of adjusted gross income. The AGI threshold returns to 10% in 2019.
IRS waives penalty for many whose tax withholding and estimated tax payments fell short in 2018 | Internal Revenue Service
IR-2019-03, January 16, 2019 — The Internal Revenue Service announced today that it is waiving the estimated tax penalty for many taxpayers whose 2018 federal income tax withholding and estimated tax payments fell short of their total tax liability for the year.
Starting in 2018, mortgage interest on total principal of as much as $750,000 in qualified residence loans can be deducted, down from the previous principal limit of $1,000,000. For married taxpayers filing a separate return, the new principal limit is $375,000, down from $500,000.
The 2018 tax filing year is the first year in which small buinesses can start to take the Section 199A Qualified Business Income Deduction. Contact Green Hill to find out if you qualify and how it will impact your taxes.
Green Hill is here if you need to file an extension.
If you own a small business, you need to know about the Section 199A Deduction for Qualified Business Income of Pass-Through Entities.
44330 Mercure Cr. Suite 100D
Aldie, VA
20166
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