2021 Tax Filing FAQs

For individual returns, the filing deadline is April 18, 2022.

• Take a charitable contribution deduction, even if you don’t itemize: up to $300 for single filers and $600 for joint.

• If you itemize:

  • medical expenses exceeding 7.5% of your adjusted gross income (AGI) will count;

  • charitable contributions can be deducted up to 100% of your adjusted gross income;

  • taxes are limited to $10,000 ($5,000 if filing married / separate);

  • mortgage interest is limited to $750,000 of principal loans.

The Child Tax Credit (CTC) has been increased and partial advances were paid in 2021 unless you opted out. The amount advanced to you will be reported on IRS letter 6419.

• The credit is $3,000 for children under 18 and $3,600 for children under age 5

• The credit can be fully refundable in 2021

• Credit phaseouts begin when AGI exceeds:

• $75,000 filing single

• $112,500 filing head of household

• $150,000 filing joint

Must be taken by April 1, 2022 if you turned 72 in 2021. The harsh penalty is 50%. See your financial advisor.

If not received, you can still get the third Economic Impact (stimulus) and Plus-Up payments by filing your return. The amounts you received must be reported which the IRS will verify on letter 6475. The payments were $1,400 each for spouses and children but phased out based on reported AGI.

You can find a lot of information and check on your refund by setting up an online account with the IRS. https://www.irs.gov/payments/your-online-account

Contribution limit for traditional and Roth IRAs is $6,000; $7,000 if you are 50. Deductibility depends on whether you are covered by a retirement plan at work and income ceilings.

Contributions to a SEP-IRA is limited to the lesser of 25% of compensation or $58,000 (which is $232,000 in compensation). You have until the date of filing your return or April 18, 2021 to make qualified IRA contributions for 2021.

Social Security wage base is $142,800 for 2021; $147,000 for 2022.

Remember available education tax savings:

• American Opportunity Tax Credit up to $2,500

• Lifetime Learning Credit up to $2,000

• Tuition and fees deduction up to $4,000

• Deduction for student loan interest up to $2,500