This bear comes around every single year without fail! If there is one thing I have learned through 40+ years of filing my taxes, its that it is never to early to start preparing for the tax bear. The sooner I get prepared, the less stress I encounter when April 15th rolls around. In an effort to help you start thinking about your taxes, I have included some information here about some recent changes for your upcoming return preparation. I hope you find something here that is beneficial.
1. Standard Deductions have increased from
2018 to 2019:
Single: $12,000 to $12,200
Married: $24,000 to $24,400
Head of Household: $18,000 to $18,350
2. Increased Contribution for 401(k) for 2020:
Under Age 50: From $19,000 to $19,500
Over Age 50: From $25,000 to $26,000
3. The “shared responsibility payment,” or penalty associated with not having individual health insurance, is reduced to zero for tax year 2019.
4. For divorces and separation agreements finalized in 2019, alimony payments are not deductible for the payer or counted as taxable income to the recipient.
5. Flexible Spending Account Increase for 2020
The limit increased from $2,700 to $2750.
Remember that this is a “use it” or “lose it”
program.
The deadline to file and pay taxes or request an extension is April 15, 2020. Additionally, October 15, 2020 is the last day to file a tax return if you received an extension from the IRS.
So, start collecting and sorting your documents and files. If something is missing, you will have ample time to track it down. If you need professional help with your taxes, give me a call or send an email. I am happy to recommend a tax professional in my network.
This season can be stressful. Remember to stay organized and get ahead of the game.