The IRS announced that the tax season will begin on Friday, February 12, 2021. This is the day the IRS begins accepting and processing declarations for the 2020 tax season.
The tax season usually starts in January. However, due to changes over the past year, the IRS needs additional time to prepare for the 2020 tax season.
Recovery Discount Credit
If you haven't received a stimulus check, you may be in for a surprise when you file your tax return. The government will issue a Recovery Rebate Credit for the 2020 tax season.
Individuals who did not qualify for a stimulus payment because their numbers for 2018 or 2019 were much higher than their AGI for 2020 will receive the tax credit in 2020. This will affect many people who may lose a job or become unemployed in 2020 have requested.
The Coronavirus Aid, Aid and Economic Security (CARES) Act, passed on March 27, 2020, contains all the details for the first round of reimbursement discount payments. The December Covid Relief Act contains information about the second round of payments that was issued.
For those who have already received a stimulus payment, that money will be treated as an upfront tax credit for 2020. Fortunately, the refund discount payments do not count as income. Therefore, the payments are not taxable. Because of this, people who have not received any money in the past year are eligible for this refundable tax credit.
IRS Free File is available now and can help you determine your eligibility.
On Friday, January 15th, the tax software IRS Free File opened. This cooperation with reputable tax partners can save you money when filing your tax return. If you made $ 72,000 or less in 2020, you may be eligible for IRS Free File. You are now ready to file your tax returns, but your information will not be sent to the IRS until February 12th.
The deadline for filing tax returns is April 15, 2021. If you owe the IRS money and don't file it on time, you will face a late penalty.
If you already know that you will not be able to meet your tax return, you can apply for an extension. You have until October 15th to file your tax returns.