In an effort to process those millions of backlogged returns faster and reduce unnecessary and unproductive communications between taxpayers and the agency, the IRS has temporarily reassigned several hundred employees as well as suspended automatic issuance of certain notices. Taxpayers, however, can significantly contribute to improving the situation by exercising patience and not calling ó or asking their tax professionals to call ó to inquire about delayed refunds or the status of their returns. In addition, taxpayers are encouraged to visit the IRS website to create and access their accounts to obtain the exact amounts of their Advance Child Tax Credit and stimulus payments for preparation of their 2021 tax returns. That is, if they did not receive Notice 1444-C or Letter 6475, in case of the stimulus, or Letter 6419 in case of Advanced Child Tax Credit. Your IRS account can be accessed at irs.gov/payments/your-online-account.There are several changes easily noticeable on the 2021 Form 1040. The cash charitable contribution for taxpayers who take the standard deduction has been increased to a maximum of $600 for married couples. This additional federal deduction also does not prevent or reduce any additional charitable contribution on Colorado state returns on Schedule 104AD. Letís say married taxpayersí 2021 cash and non-cash charitable contributions total $1,250; yet, in aggregate, they do not have enough to itemize. For ìmarried filing jointî status, they would be able to take up to $600 of the cash portion of the charitable contribution on page 1 of Form 1040 in addition to their standard deduction. Also, on their Colorado return, they would receive an additional deduction of $750. Colorado excludes the first $500 from the deduction.Recovery Rebate Credit is still available to anyone who did not receive the third Economic Impact Payment.The Child Tax Credit was increased from $2,000 to a maximum of $3,600 for each child 5 years old and younger. For children 6-17 years old, the maximum increased to $3,000. The credit is currently fully refundable for most families but must be reduced by the amount of the Advanced Child Tax Credit received during the year. The amount of the advanced credit paid to taxpayers is typically split between spouses, so make sure to include the amounts listed on both letters from the IRS. If you were ineligible to receive the credit in 2021, it will have to be partially or fully repaid.TopFlight CPA LLCTel: 720-607-8115https:www.topflightcpa.com
