Education Savings Plans Parents with young children, are faced with many rewards and challenges. One of which may be saving for the high cost of a college education. However, there are two tax-favored options that might be beneficial: READ MORE
Education Tax Credits There are two credits available to help taxpayers offset the costs of higher education. The American opportunity tax credit (AOTC) and the lifetime learning credit (LLC) may reduce the amount of income tax owed. Taxpayers who pay for higher education can see these tax savings when they file their tax returns next year. READ MORE
2021 Charity Deductions You probably know that you can get an income tax deduction for a gift to a charity if you itemize your deductions. However, the Consolidated Appropriations Act, 2021 offers enhanced tax incentives for making charitable contributions for the 2021 tax year. READ MORE
If you receive an e-mail from CCH-ReturnNotification@wolterskluwer.com
with the subject: “2021 Electronic Return Accepted by the IRS” – it is a real
confirmation and not a scam. This e-mail message is generated from our tax
software provider to let you know that the IRS has received your return. There
is no action required.
Remember to provide the amount of the Recovery Rebate Credit (also known as the Stimulus Payment) you received in 2021 with your tax documents. The Recovery Rebate Credit was $1,400 for each eligible individual ($2,800 for a joint return) plus $1,400 for each dependent. The IRS distributed the advanced refund based on 2019 or 2020 returns starting in March 2021. The payment was either a direct deposit, check or a prepaid debit card, so make sure to check their records / bank statements to see if this was received.While it is not considered taxable income, it is important to let your tax preparer know if you received that money.
REMINDER: If you are using your eVault Client Portal to upload tax source documents. Please put them together and upload one file or as few files as possible. When you are finished, e-mail our Tax Department at tax@valleynationalgroup.com.
Charles Schwab 1099 forms are scheduled to be available February 16. If we manage your assets with Schwab accounts, we will receive those forms automatically. If you have all of your other source documents, please send everything to us and we will add in the Schwab statements for you – no need to wait for your copies.
REMINDER: If you are using your eVault Client Portal to upload tax source documents. Please put them together and upload one file or as few files as possible. When you are finished, e-mail our Tax Department at tax@valleynationalservices.com.
A note from the VNFA Tax Department Tax preparation clients will receive a combined packet with an engagement letter, tax questionnaire, and personalized organizer, including document checklists. These were mailed on January 20 and should be used as a guide when collecting tax source documents. Please complete the combined packet and return it with your tax source documents once you have them all gathered. Please only deliver your completed packet once you have all of your documents collected so that we can accept and track one file to begin your tax return preparation. Visit valleynationalgroup.com/tax for updates on our 2021 tax preparation process.
Fourth
quarter estimated tax payments are due TODAY – January 18, 2022.
1099 Tax Reminders Once again, it is the time of year to think about your filing requirements as a small business owner, self-employed individual, or owner of rental property. If you operate for gain or profit, the IRS considers you to be engaged in a trade or business and therefore required to file certain information returns. Information related specifically to the Form 1099-MISC, Miscellaneous Income, and the Form 1099-NEC, Nonemployee Compensation, can be found at https://www.irs.gov/instructions/i1099mec.
Form 1099-NEC is due on or before January 31, 2022, using
either paper or electronic filing procedures.
File Form 1099-MISC by February 28, 2022, if you file on
paper, or March 31, 2022, if you file electronically.
The IRS operates a centralized call site to answer questions
about reporting on Form 1099 and other information returns. If you have
questions related to reporting on information returns, the IRS centralized call
site can be reached at 866-455-7438. In
addition, please feel free to contact our VNFA Tax Department at tax@valleynationalgroup.com or
610-868-9000.
Letter 6475 Individuals who did not qualify for a third Economic Impact Payment or got less than the full amount may be eligible to claim the Recovery Rebate Credit. However, they will need to know the total amount of their third Economic Impact Payments received to calculate their correct 2021 Recovery Rebate Credit amount when they file their 2021 tax return. The IRS announced that it would send Letter 6475 with the total amount of the third Economic Impact Payment received beginning in late January.
Fourth quarter estimated tax payments are due January 18, 2022. These estimates may include federal, state and/or local vouchers depending on your situation.
If quarterly estimates were recommended when we prepared your 2020 return, they would be included with your tax return. If you requested a paper client copy of your return, the instructions, vouchers and envelopes were included with your tax folder. If you requested an electronic client copy, the instructions and vouchers were included in both the client copy and action needed copy posted to your client portal.
Please follow the applicable instructions previously provided to mail your payment and voucher by January 18, 2022.
There may be situations where the estimates were generated, but an overpayment was applied in full or in part. If your income or withholdings have significantly changed since last year, please contact your tax preparer to review. If you change or do not make the estimates, please let your tax preparer know at tax filing time.
Changes to VNFA Tax Process Our Tax Department continues to roll out efficiencies to make the tax preparation process easier for our clients. New this year, we will be sending tax preparation clients a combined packet with engagement, questionnaire, and personalized organizers with document checklists. These will be distributed later in January and should be used as a guide when collecting tax source documents. The combined packet should be complete and returned with your tax source documents, and not before. We look forward to sharing more innovative updates with you as 2022 unfolds.
