CPA shares his tax advice for Wisconsinites
Filing last year’s taxes means navigating new items and new rules.
MADISON, Wis. (WMTV) - The Internal Revenue Service is now accepting your 2020 tax returns, and given the pandemic, what you write on those forms may be very different this year.
“Things are a lot more complicated. There’s still a lot of unknowns with a lot of the tax codes this year,” Steve Santek, a partner at Middleton-based Meicher CPAs, said. NBC15 sat down with Santek to break down some of that confusion.
Santek’s advice to small business owners:
The federal government will not tax your Paycheck Protection Program (PPP) loan, but that isn’t the case at the state level, at least for now. He said Wisconsin lawmakers are trying to follow the IRS and make the loan non-taxable.
“Most of these small business returns are due March 15,” he explained. “We’re saying extend those returns out to see if this shakes out before personal returns are due on April 15. If not, we may have to file those returns at some point. If the state decides to follow the IRS guidance, we’ll have to amend those returns at a later date.”
Unemployment benefits are taxed at the federal level. However--
The advice to hold off also applies to the millions of Americans who filed for unemployment in 2020. Santek said U.S. lawmakers are currently negotiating a stimulus bill, trying to make unemployment benefits non-taxable.
What he recommends people to do: “Go ahead and prepare your 2020 return as if they’re taxable to see if you’re going to owe any money on April 15, but hold off on actually filing that return to see if the stimulus bill gets passed before you need to file your return. If it does and those becomes non-taxable then you should get that withholding back,” he said.
As for those stimulus checks...
If you qualify but didn’t get either of the two payments, you can claim the Recovery Rebate Credit on your 1040 worksheet.
When will I get my refund?
Santek said the IRS usually sends a refund out within two to three weeks. He doesn’t expect any major delays.
Here are some key dates according to the IRS:
- February 22. Projected date for the IRS.gov Where’s My Refund tool being updated for those claiming EITC and ACTC, also referred to as PATH Act returns.
- First week of March. Tax refunds begin reaching those claiming EITC and ACTC (PATH Act returns) for those who file electronically with direct deposit and there are no issues with their tax returns.
- April 15. Deadline for filing 2020 tax returns.
- October 15. Deadline to file for those requesting an extension on their 2020 tax returns
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