PITTSBURGH – It’s that time of year. We have all got our W-2s and 1099s to file our taxes, and this year it’s more than ever a good idea not to defer.
Channel 11’s Angie Moreschi explains why and has three important things to know before applying.
Child tax deduction confusion
If you received COVID-19 relief money, the confusion over how much in tax you have to pay continues. It means get started early is more important than ever to solve any problems.
First, if you have children, it’s time for it settle with these child tax deductions. In 2021, millions of eligible families received six prepayments of up to $ 300 for the extended child tax deduction. It raised up to as much as $ 1800 per child under the age of 6 or $ 1500 per child aged 6 to 17 years.
To claim the second half of the extended child tax deduction, enter specific information about your 2022 taxes. You should have received something called Letter 6419 from the IRS, which describes the total amount of prepayments you have received.
If you opted out of prepayments, missed getting any payments, or got too much, it’s time to reconcile it on your 2022 taxes. Also, if you have received more than you can claim, the IRS says you must pay it back.
Financial expert Shana Bielich with Coghill Financial Investments says it’s important to understand that the government based the amount you received on your tax income in 2020. So any changes can make a difference in how much you should get.
“What consumers need to be aware of is what if their income has changed drastically year by year from 2020 to 2021? Or what if you had a baby or adopted a child in 2021 – you can claim these credits on your tax return for 2021, so you just have to be aware of that, “Bielich said.
Extra stimulus payment
There was a third stimulus check worth up to $ 1,400, which went out to millions of Americans who qualified in 2021. The qualifying amount was up to $ 75,000 for single files and up to $ 150,000 for married files. Relatives were also entitled to a payment of $ 1,400.
Bielich says the most important thing here is to make sure you got it if you qualify.
“You can still claim the credit while submitting your return. It says the recovery rebate credit“, she explained.
Another thing to note here: If your income changed from 2020 to 2021 and you ended up earning too much to actually qualify for the third stimulus check, but still got it, do not have to pay it back In contrast to the child tax deduction.
Delays are likely
Finally, the last thing you really need to know is that delays are likely for many because the backlog from the pandemic is still not fixed.
“It’s been a real challenge,” Bielich said. “The IRS has said they expect their repayments to be processed within 21 days, but we have people waiting more than 270 days for a return.”
There are three important things you can do to try avoid getting stuck in the backlog.
- Be extra careful not to make mistakes; double- and triple-check your return to make sure there are no errors.
- File electronically – paper just takes longer to process.
- Use direct deposit to get your refund faster.
Deadline April 18
This year, you have three extra days to file because April 15 is on a Friday, which is Freedom Day in Washington, DC. The IRS extended the deadline to Monday, April 18, but you do well not to wait, long.
CLICK HERE for five things that the IRS says you need to keep in mind before filing an application.