Tax season is starting soon. Here is what could impact your return
NORFOLK, Virginia – On top of everything we’re already facing – COVID, getting kids back to school, paying remaining vacation bills – adding taxes to the list.
Tax season begins January 24 with a deadline of April 18 this year.
Kevin Zywna, Certified Financial Planner and President of Wealthyway Financial Advisors in Norfolk, says the Biden administration’s Build Back Better bill would have changed tax brackets and tax rates, had it passed before the new year.
Because that’s not the case, Zywna told News 3 that any changes we’ll see in our returns this year will largely depend on what’s going on in our lives.
“If you have a child that’s born, that’s a change. If you get married or divorce, these are big changes that will impact your taxes,” said Zywna, who also said the loss or job change may also affect them.
Two other changes are also likely to impact your return, he says:
- In 2021, eligible families could receive the first half of their child tax credits at the start of monthly payments. Those who have done so will only receive the second half when they deposit.
- Those who choose to delay the repayment of their student loan would lose the tax deduction that would have been associated with the interest payment.
As to how what we can do now to affect our returns, Zywna says investing extra money in an Individual Retirement Account (IRA) is a possibility for those who qualify as long as it’s done before the tax deadline.
It’s also a good time, he suggests, to start thinking about next year’s comeback.
“Start contributing to the company pension plan or increase the amount you contribute to the pension plan. This is pre-tax, which means you get a tax deduction for it and build up your equity for your retirement. the road, ”Zywna told News 3.
And remember that people with a low enough income – often those who live solely on Social Security – technically don’t have to file taxes, but filing is always a good idea, Zywna says, because it does allows you to get your information into the government system.