Tax season for 2021 is unlike many recent tax seasons.
There have been many changes to policies and laws, resulting in a bit of confusion.
Along with that comes more opportunity to lower your tax bill, increase your refund, and claim any stimulus cash you might have missed out on.
The IRS has not shared when they plan to begin accepting tax returns, but in the past it’s been around the end of January normally.
Here are some things you should be aware of ahead of tax season
The child tax credit payments you received in advance might impact your refund amount.
Families received the first half of their child tax credit in 2021 over the span of 6 months between July and Dec.
Some families saw as much as $300 per month based on the estimate of them receiving a $3,600 credit for children under age 6.
Others received up to $250 for kids ages 6-17 based on a possible $3,000 credit.
These payments may have a direct impact on your refund when you go to claim the second half of the child tax credit.
It could be bigger, smaller, or you may even owe more.
You will soon receive a Letter 6419 detailing the dollar amount you were sent, and that is the amount you’ll report on your tax return.
The other thing to keep in mind ahead of tax season is the Recovery Rebate Tax Credit.
If you got a smaller payment, or no payment at all, for your third stimulus check you could claim the recovery rebate to get that money back.
This often happened to those who had old and outdated tax information used from 2019.
To get it, you need to file a tax return and know the amount you did get originally, if you got a partial payment.
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