MONARCH ACCOUNTING GROUP
  • Home
  • Solutions
    • CFO Services
    • Cloud ACCOUNTING
    • Bookkeeping Services
    • QuickBooks Training
    • Income Taxes
    • Other Services
  • Resources
    • Tax Rates
    • SmartVault
    • Tax Tips
    • Tax Organizer
    • Record Retention Schedule
  • Reviews
  • Meet Us
  • Blog
  • Contact Us

Common Tax Increase SurprisesI did not owe that last year!

2/14/2022

0 Comments

 
Picture
Picture this: For the past few years you've received your tax return and have had a small but nice refund. Now imagine your surprise, when this year, you are required to send in a fairly big check to settle your tax bill. Believe it or not, this message is almost as hard to deliver to you as it is to hear it. Here are some situations to watch for that can increase your tax liability:


New tax laws. The multiple bills passed to pay out assistance from government programs must now be accounted for on this year's tax return. While the goal of the legislation is to reduce taxes, there are several changes that could cause you to pay more taxes, including:
  • Repayment of excess economic stimulus checks.
  • New taxability of unemployment benefits.
  • Accounting for any small business loan and grant benefits.
  • The need to take required minimum distributions once again in 2021.

A child is no longer eligible. This year's child tax credit is a big increase versus prior years. But if you already received the money through the advance child tax credit payment system, it will impact your refund this year. And as children get older they grow out of lots of things — clothes, interests and tax credits. Here are some age requirements for popular tax benefits:
  • Child and Dependent Care Credit: under age 13
  • Child Tax Credit: over age 17
  • Earned Income Tax Credit: under age 19 (24 if a qualified student)

Earnings with Social Security benefits. If you are recently retired, start collecting Social Security Benefits, and then begin working part-time, you are also in for a tax surprise. These extra earnings could not only make your Social Security benefits taxable, it could result in a reduction of benefits received.


Other life events. Other life events could provide a tax surprise for you. While some may have positive tax consequences, like a new birth, or becoming the head of household, others might surprise you and result in additional tax. Other common life events include retirement, death and entering/leaving school.


Capital gains surprises from mutual funds. Often sales of investments are a planned event. Unfortunately, many mutual funds sell assets and then you receive a capital gain statement with a surprise taxable event.
Want to avoid these surprises? Spend some time now reviewing your anticipated tax situation for 2021. By doing so, perhaps a planned pleasant surprise can be in store for you.

"Tax Tips" are published to provide current tax information, tax-cutting suggestions, and tax reminders. If you would like more information on anything in "Tax Tips," or if you'd like to be on our mailing list to receive other tax information from time to time, please contact our office.
 
The tax information contained in this site is of a general nature and should not be acted upon in your specific situation without further details and/or professional assistance.
 
We are trusted CPA advisors servicing Burr Ridge, Hinsdale, Willowbrook, Darien, Naperville, and all Chicagoland area. 
​

0 Comments

Your comment will be posted after it is approved.


Leave a Reply.

    BLOG

    To better serve our clients and friends, to keep you up-to-date and informed, our blog is a resource for tax tips and overall accounting related articles. We hope you find this useful!


    CATEGORIES​

    All
    Business Owners: Must Know
    IRS Tax Tip
    Monthly Newsletter
    Tax Return: Must Know
    Tax Tip Of The Week


    ARCHIVES

    February 2023
    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015

    RSS Feed

Picture
Picture
Picture
Picture
Phone: (630) 320-3720

Monarch Accounting Group Inc
145 Tower Drive, Suite 4
Burr Ridge, IL 60527-7836
Email: Info@MonarchAccountingGroup.com


Picture
Picture
Picture
Picture
Picture
Picture
Picture
Picture
  • Home
  • Solutions
    • CFO Services
    • Cloud ACCOUNTING
    • Bookkeeping Services
    • QuickBooks Training
    • Income Taxes
    • Other Services
  • Resources
    • Tax Rates
    • SmartVault
    • Tax Tips
    • Tax Organizer
    • Record Retention Schedule
  • Reviews
  • Meet Us
  • Blog
  • Contact Us