MVP Taxes & Professional Services, LLC

12/28/2024

Update on BOI

FinCEN has extended the Jan. 1, 2025, deadline for most reporting companies to file beneficial ownership information reports with the Treasury Department until Jan. 13, 2025, after a federal court of appeals lifted an injunction on Dec. 23 that had halted the new law.

10/19/2024

Available in Amazon now!

01/24/2023

Tax Tip 2023-07, January 24, 2023 — Most of the common errors taxpayers make on their tax returns are easily avoidable. By carefully reviewing their return, taxpayers can save time and effort by not having to correct it later.

01/24/2023

IR-2023-11, January 23, 2023 — The Internal Revenue Service kicked off the 2023 tax filing season with a focus on improving service and a reminder to taxpayers to file electronically with direct deposit to speed refunds and avoid delays.

01/17/2022

Important Letters for 2021 Tax Credits – Did You Know?

The IRS has begun sending Letter 6419 about the 2021 Child Tax Credit (CTC) to millions of U.S. households. By the end of January, many taxpayers will also start receiving IRS Letter 6475 about Economic Impact Payments (EIPs, also called stimulus payments). Taxpayers may need to refer to these letters to prepare their 2021 tax returns and claim their full credit amounts.

If you received advance payments of the 2021 CTC, Letter 6419 will show the total amount of those payments. Other information in the letter will include how many qualifying children the IRS used as the basis for calculating your payment amounts.

You may also look up the total of your 2021 advance CTC payments by checking the CTC Update Portal (link below). If you did not receive advance payments but qualify for the CTC, you may claim your entire credit by completing a 2021 tax return. Even if you owe no tax and ordinarily do not have to file a return, filing for 2021 may enable you to receive the CTC as an IRS refund.

IRS Letter 6475 (“Your Economic Impact Payment”) refers to the third round of pandemic EIPs, known as EIP3, that the IRS began issuing in March 2021. If you received an EIP3 direct deposit, check or prepaid debit card, or a 2021 EIP “plus-up” payment, watch for Letter 6475 in late January or early February. If you qualified for EIP3 or a “plus-up” payment but did not receive it, or your payment amount was too low, you may be able to claim the Recovery Rebate Credit on your 2021 tax return to get the remaining amount you are owed.

Store both of these IRS letters safely with your tax records, so you can refer to them when preparing your tax return. A tax professional can help you figure your total credit amounts, and electronically file your return to receive your refund as quickly as possible.

IRS CTC Update Portal: https://www.irs.gov/credits-deductions/child-tax-credit-update-portal

01/11/2022

Quarterly Estimated Tax Payments - Reminder

If you are making quarterly estimated tax payments to the IRS, the due date for the September 1st - December 31st, 2021 quarter of year is January 18th, 2022. You may be able to skip the January 18th payment if you file your 2021 return by January 31st, 2022 and pay all tax due.

For payments made using IRS Direct Pay, you can make payments until 11:45PM EST, and for payments using a credit or debit card, payments can be made up to midnight on the due date.

01/10/2022

Tax Filing Season Start

The IRS has announced that the individual tax filing season will start on Monday, January 24th, 2022 and the current deadline for most people to file 2021 tax returns and pay any taxes owed is Monday, April 18, 2022.

01/04/2022

Standard Mileage Rates for 2022 – Did You Know?

The IRS has updated the 2022 standard mileage rates for vehicle uses that qualify for a tax deduction. These rates apply for most passenger vehicles, including cars, vans, SUVs and pickup trucks. Here are the main mileage rates for this year:

- 58.5 cents per mile for business use of a vehicle (up 2.5 cents from 2021)
- 18 cents per mile for certain medical purposes (up 2 cents from 2021)
- 14 cents per mile for vehicle use for qualifying charitable work (unchanged)
- 18 cents per mile for Armed Forces members who have a permanent change of station, and use their vehicles for relocation (up 2 cents from 2021)

In most cases, taxpayers who qualify to claim a vehicle expense deduction may either use the standard mileage rate or actual expenses to figure their deduction. However, if you use your car or truck for business, you must use the standard rate for the first year you put the vehicle in service if you want to preserve this option for future years.

A tax professional can help you determine whether the standard mileage rate or actual expenses will result in a larger deduction in your circumstances. Keep in mind that if you choose to deduct actual expenses, you will need to keep detailed records of all vehicle-related costs.

12/27/2021

Deferred Social Security Tax Payment Deadline - Did You Know?

The IRS allowed employers and self-employed people to choose to defer the employer's portion of their social security tax payments in 2020.

For those that chose to defer payment, half of that deferral will be coming due on January 3rd, 2022 and the second half will be due on January 3rd, 2023.

Payment can be made through the Electronic Federal Tax Payment system by employers and individuals. Individuals may also use Direct Pay.

EFTPS: https://www.eftps.gov/eftps/
Direct Pay: https://www.irs.gov/payments/direct-pay

12/20/2021

'Tis the Season for Important Tax Paperwork

Keeping your records organized will help make sure you don't miss out on valuable deductions when it is time to file.

Here are some documents to be on the lookout for:

- Wage and income statements (W-2 or 1099-MISC)
- Health Insurance statements (Form 1095)
- Proof of qualifying educational expenses (Form 1098-T)
- 2021 Total Advance Child Tax Payments (Letter 6419)
- Your 2021 Economic Impact Payment (Letter 6475)
- Mortgage interest statements
- Retirement distribution statements
- Investment account statements
- Charity donation receipts

12/14/2021

Preparing for a Smooth Tax Season (2/2)

The IRS recently posted a number of reminders about steps taxpayers can take in December to make sure they are ready for the upcoming tax season. Here are some key highlights:

USE UP YOUR FSA FUNDS:

If you have a workplace flexible spending arrangement (FSA) for medical or other qualified expenses, remember that FSAs have an annual use-it-or-lose-it rule. You will typically forfeit any funds left in the account on January 1. However, your employer may offer a special carryover or grace period option for health FSAs this year due to the pandemic. Check with your workplace benefits department to learn how the use-it-or-lose-it policy may affect your account. If you are at risk of losing funds, schedule qualifying expenses like dental work or eye checkups now.

SET UP A BANK ACCOUNT WITH DIRECT DEPOSIT:

If you provide direct deposit banking information to the IRS, you can get your tax refund up to three weeks faster than with a mailed check. If you do not know whether your accounts can receive direct deposits, check with a customer service agent at your bank.

DONATE TO CHARITIES:

The holiday season is an ideal time to contribute to charitable organizations, and there is an extra incentive to be generous this year. Ordinarily, taxpayers can only deduct charitable contributions if they itemize deductions. However, the American Rescue Plan Act created a special tax provision that enables taxpayers to claim a deduction of up to $300 (up to $600 for joint filers) for monetary contributions to qualifying charities in 2021. You can use the IRS tax-exempt organization search tool (link below) to verify that your charity of choice accepts tax-deductible donations.

A tax professional can help you plan your FSA use and charitable giving strategies, and suggest other steps to ensure a smooth filing season without unpleasant surprises.

IRS Charity Search Tool: https://www.irs.gov/charities-non-profits/tax-exempt-organization-search