LOVELAND MAGAZINE

News and Events from the Loveland, Ohio Area

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Since 2004

Tag: Internal Revenue Service (IRS) Publication 526

  • IRS extends Federal filing for individuals until May 17

    IRS extends Federal filing for individuals until May 17

    Does not apply to State and Local taxes

    The Treasury Department and Internal Revenue Service announced today that the federal income tax filing due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021, to May 17, 2021. The IRS will be providing formal guidance in the coming days.

    “This continues to be a tough time for many people, and the IRS wants to continue to do everything possible to help taxpayers navigate the unusual circumstances related to the pandemic, while also working on important tax administration responsibilities,” said IRS Commissioner Chuck Rettig. “Even with the new deadline, we urge taxpayers to consider filing as soon as possible, especially those who are owed refunds. Filing electronically with direct deposit is the quickest way to get refunds, and it can help some taxpayers more quickly receive any remaining stimulus payments they may be entitled to.”

    Individual taxpayers can also postpone federal income tax payments for the 2020 tax year due on April 15, 2021, to May 17, 2021, without penalties and interest, regardless of the amount owed. This postponement applies to individual taxpayers, including individuals who pay self-employment tax. Penalties, interest, and additions to tax will begin to accrue on any remaining unpaid balances as of May 17, 2021. Individual taxpayers will automatically avoid interest and penalties on the taxes paid by May 17.

    Individual taxpayers do not need to file any forms or call the IRS to qualify for this automatic federal tax filing and payment relief. Individual taxpayers who need additional time to file beyond the May 17 deadline can request a filing extension until Oct. 15 by filing Form 4868 through their tax professional, tax software or using the Free Filelink on IRS.gov. Filing Form 4868 gives taxpayers until October 15 to file their 2020 tax return but does not grant an extension of time to pay taxes due. Taxpayers should pay their federal income tax due by May 17, 2021, to avoid interest and penalties.

    The IRS urges taxpayers who are due a refund to file as soon as possible. Most tax refunds associated with e-filed returns are issued within 21 days.

    Estimated tax payments

    This relief does not apply to estimated tax payments that are due on April 15, 2021. These payments are still due on April 15. Taxes must be paid as taxpayers earn or receive income during the year, either through withholding or estimated tax payments. In general, estimated tax payments are made quarterly to the IRS by people whose income isn’t subject to income tax withholding, including self-employment income, interest, dividends, alimony or rental income. Most taxpayers automatically have their taxes withheld from their paychecks and submitted to the IRS by their employer.

    State tax returns

    The federal tax filing deadline postponement to May 17, 2021, only applies to individual federal income returns and tax (including tax on self-employment income) payments otherwise due April 15, 2021, not state tax payments or deposits or payments of any other type of federal tax. Taxpayers also will need to file income tax returns in 42 states plus the District of Columbia. State filing and payment deadlines vary and are not always the same as the federal filing deadline. The IRS urges taxpayers to check with their state tax agencies for those details.

  • Charitable giving: Where head and heart meet

    Charitable giving: Where head and heart meet

     

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    How can a person support organizations that help people in need? Some may choose to give their time and abilities through volunteer service while others may provide financial support. Charitable giving provides an opportunity to engage both your head and your heart in making a difference. The following tips from Thrivent Financial can help donors make the most of their charitable gifts:

    • Choose a reputable organization. Never give to an organization without first knowing its purpose and effectiveness. The BBB Wise Giving Alliance can help you evaluate your options.
    • Budget for donations. Systematic gifts spread throughout the year may help donors give more than if they give a one-time gift based on their financial leftovers.
    • Keep good records. To deduct donations for tax purposes, people must keep an appropriate record of their contributions. The type and value of one’s gift may require specific forms of acknowledgement from the recipient organization. For details, see Internal Revenue Service (IRS) Publication 526.
    • Take advantage of tax benefits. In order for a charitable donation to be tax-deductible, the charity must be recognized by the IRS as a qualified organization. Most organizations can confirm their status or you can verify independently at IRS.gov.
    • Give generously and wisely.  From wills, living trusts, charitable gift annuities, endowments,and mini-foundations, to gifts of appreciated stock, retirement funds or real estate, there are many vehicles through which individuals can make charitable gifts.

    Special care should be given when determining the option that meets one’s financial circumstances. Gifting some assets to IRS-recognized charities may potentially reduce capital gains tax. Life insurance may also be an excellent option to magnify a gift.

    • Consult with experts. Always consult with a financial, legal and/or tax professional before putting a gifting plan into action.

    When moved to make a difference, donors should remember there are many options for making a financial gift. Just be sure to explore the options and enlist appropriate support along the way. By fully planning a charitable gift, a person can ensure their head and their heart are satisfied.

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    This article was prepared by Thrivent Financial for use by Loveland representative FR-Libby Greiwe. She has offices at 423 Wards Corner Rd. in Loveland and can also be reached at (513) 239-2933 or via email at ThriventLovelandAssociates@thrivent.com.

    About Thrivent Financial
    Thrivent Financial is a financial services organization that helps Christians be wise with money and live generously. As a membership organization, it offers its more than 2.3 million member-owners a broad range of products, services and guidance from financial representatives nationwide. For more than a century it has helped members make wise money choices that reflect their values while providing them opportunities to demonstrate their generosity where they live, work and worship. For more information, visit Thrivent.com/why. You can also find us on Facebook and Twitter.

    Insurance products issued or offered by Thrivent Financial, the marketing name for Thrivent Financial for Lutherans, Appleton, WI. Not all products are available in all states. Securities and investment advisory services are offered through Thrivent Investment Management Inc., 625 Fourth Ave. S., Minneapolis, MN 55415, a FINRA and SIPC member and a wholly owned subsidiary of Thrivent. Thrivent Financial representatives are registered representatives of Thrivent Investment Management Inc. They are also licensed insurance agents/producers of Thrivent. For additional important information, visit Thrivent.com/disclosures.