What's New for 2020 Tax Laws

Tax Law changes

Traditional IRA contributions

If you are over 70 1/2 thanks to the Secure Act change their is no longer an age limitation for deductible contributions to a traditional IRA. Is the government telling us to work past 65?

Itemizing for 2020? 

If you aren't itemizing and will take the standard deduction, the Cares Act allows a new "above the line" deduction for cash charitable contributions up to $300.  When you donate $300 this will give you a tax saving of $36 if your tax bracket is 12%; $60 if your tax bracket is 20% and $72 if your tax bracket is 24%. Obviously this is not a big break!

Get your Stimulus payment if you didn't receive a stimulus check last year.

If you didn't receive the stimulus check in 2020, you can reconcile in the 2021 tax season on your 2020 tax return to get it.

You will be able to get the stimulus according to the IRS.

 

Summary of the four new acts FLP must look at while preparing for the 2021 filing season.

  1. Families First Coronovirus Response Act (FFCRA). Paid sick leave  and paid family leave.
  2. Further Consolidated Appropriations Act, 2020 (FCAA). This extended some expired or expiring provisions. The four most likely that individuals will be impacted by are: Discharge principal residence debt, Mortgage insurance premiums, medical expense deduction from 10% to 7.5% and Qualified tuition and fees deduction.
  3. Taxpayer First Act (TFA).Implement measure to address cybersecurity and identity theft.
  4. Coronavirus Aid, Relief, and Ecomonic Security Act (CARES). The CARES act has a variety of provision and pending legislation thatr cpuld change the law.

 

 

 

 

 

 

 

 

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