Welcome March!
It's the last full month
of high tax-filing season.
How did this happen so quickly?!?
Back in simpler tax times, all we had to worry about was whether to attack our tax returns like a lion.
Now, however, health concerns have complicated things. The persistent COVID-19 pandemic and associated precautions are making lambs of many filers. That's OK. Health and safety always rank ahead of taxes. When you are ready to get to work on your taxes, regardless of your March tax animal persona, these tips are aimed to help you cope with your tax obligations under these new and sometimes frightening times.
March 1: The easiest first tax-filing step is to gather all the tax statements you'll need to fill out your 2020 return. Even with slow snail mail delivery, you should have most by now. Also check your email box for notifications that tax documents can be downloaded from your employer's or other statement issuers' websites.
March 4: Official tax statements aren't the only things you'll need to help you file. Other documents have information that's relevant to your tax return. So are the answers to some basic life questions. This tax checklist can help guide you as you work on your return. Don't forget about your previous tax return. That prior tax year filing is a good template, especially if your tax life hasn't changed that much.
March 8: Tax reform enacted in 2017 greatly increased the standard deduction amount. That's meant that even more taxpayers use these set amounts when they file. But maybe last year you had large medical expenses that could mean you'd be better off itemizing. The standard deduction amounts are shown directly on Form 1040. But before you take that easy deduction route, examine the issues that will help you determine whether it's better to claim the standard deduction or itemize.
March 10: Coronavirus vaccines are rolling out, albeit slowly, and some pandemic precautions are being lifted. That means some restaurants are opening for a limited number of diners. Other eateries are continuing with curbside pickup meals and deliveries. Whether you're able to enjoy table service or still relying on food brought to your house, remember to tip your server or delivery person.
If a tip isn't included in your food delivery charge, click the image above to calculate how much to tip the person who brought it to you.
As for servers who are still on the job, remember that your
tips are taxable income. If you at least $20 in job-related gratuities in January, you need to account for them today by using
Form 4070 to report your tips today to your employer.
March 15: This date is more than a
literary reference. The
Ides of March apply each year to many business taxpayers. Today is the
tax filing deadline for partnerships (Form 1065 with K-1 schedules) and S corporations (Form 1120S).
March 17: Erin Go Bragh and
Happy St. Patrick's Day!
via GIPHYEnjoy this day, but don't trust lucky charms to get you through tax filing season. Double check your 1040 to ensure you haven't
overlooked any tax breaks or made any common
filing mistakesMarch 20: Spring has sprung!
That means it's time for
spring cleaning. Your gifts won't help with your current tax return, but they could pay off next year as
charitable donation deductions. Even better, for 2020 and 2021 tax year filings, you don't have to itemize to get some tax benefit from your generosity. A new
COVID-19 inspired charitable deduction law allows cash donations up to $300 to be claimed directly on your 2020 Form 1040. Next year, the no-itemizing-needed deduction is $300 for single taxpayers and $600 for married couples filing jointly.
March 23: Last year, the COVID-19 toll on investments prompted lawmakers to
waive required minimum distributions (RMDs). They are back for 2021 and although the
RMD trigger age now is 72 instead of 70½, the withdrawals from tax-deferred retirement accounts still are due on April 1. No fooling. Note, too, that if you were taking RMDs before the law change, the return of the RMD deadline still applies even if you haven't yet turned 72.
March 27: With a few March days to spare, you're ready to finish your filing. The IRS recommends you use tax software and e-file your return. That will speed up the processing of your 1040 and, if you're due a refund, get the money on its way to you sooner. The IRS also suggests you use Free File, the online no-cost tax preparation and e-filing partnership between the IRS and Free File Alliance.
The official
Free File site at IRS.gov has been accepting returns since Jan. 15. You can use one of this year's
nine participating tax software options if your adjusted gross income is $72,000 or less, regardless of filing status.
March 31: Wow! March is over? Time really does fly when you're having tax fun. Or even if it's not so much fun. If you need filing help but can't afford to hire a tax professional, look into
Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) options. These sites across the nation are staffed by IRS-trained volunteers who can help low-to-middle-income and older taxpayers prepare and e-file their returns for free.
Small Business Tax Calendar: Important
filing, deposit and record keeping dates throughout the year that your company needs to know. You can get more tax calendar information at the IRS'
online calendar page and view the full year's important business and individual tax dates in
IRS Pub. 509.
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