Covid-19 Tax Changes
By Michael Aston, E.A.
Alhambra Tax Center
Covid-19 has brought many changes within the tax industry. With the year 2019 tax return deadline extended to July 15, 2020. Here are a few other changes:
· If you haven’t filed your year 2016 Federal tax refund - the IRS extended the deadline to July 15, 2020.
· If you pay estimated tax payments…your first quarter payment were normally due on April 15, 2020. And the second quarter was due on June 15, 2020. Both quarterly payments are now due on July 15, 2020.
· The IRS is suspending the Required Minimum Distribution for the year 2020.
· When filing your year 2020 income tax returns -- the IRS is going to allow a $300 charitable contribution deduction. (Non-cash contributions, like clothes to Goodwill, will not qualify.)
· The 80% income limitation of the Net Operating Losses (NOL) deduction is temporary repealed for years beginning 2021. For losses arising in 2018, 2019 & 2019, a five year carryback is allowed (taxpayers can elect to forgo the carryback).
· There are more changes that affect individuals and business which can be found on the IRS website.
The stimulus program should be paid to most eligible recipients. If you have not filed your year 2018 and 2019 income tax returns -- go to the IRS website and click on “Get My Payment”. Enter the appropriate information. (The checks are taking 2 weeks to arrive.)