WEST DES MOINES, Iowa — The start of income tax filing season is here.
This year there are some changes and issues the public should be on the lookout for, according to Cameron McCarty with Vivid Tax Advisory.
Number one: people should file earlier rather than later.
"Anticipate some delays here," McCarty said. "I mean I still have clients that have not received refunds from last tax season."
For that reason, it's important when it is time for people to file they need to have all of their necessary documents in order.
McCarty also said when people are filing this year, they need to take notice of the changes to the Advanced Child Tax Credit.
There was a one-time increase last year involving parents or guardians for children under six to get up to $3,600. For children six through 17, the credit increased to up to $3,000.
McCarty said those amounts phased-out based on income. He did note that if people did choose to take some of that credit between July-December, they need to remember their refund will be affected.
"They'll get the second half when they file their 2021 tax return."
And if a person opted out of receiving those advance payments last year, they could be entitled to the full credits when they file.
The financial professional said unlike 2020, unemployment benefits are being taxed.
Remember: The last day to file your taxes is April 18, 2022 unless you have been granted an extension.
"Some people think that when they are receiving unemployment benefits taxes are automatically withheld," McCarty said. "That is not always true. So if you did not withhold taxes for unemployment this year be prepared that you may have a tax burden when you file your tax return."
Michael Bootsma, an accounting professor at Iowa State University, told Local 5 there is a new charitable deductible where taxpayers could deduct as much as $600 this year.
"They're now allowed to take that charitable deduction up to a certain amount depending on whether they're single or married, even if they don't itemize," Bootsma said.
McCarty added for people dealing with the advanced child tax credits, they need to wait until they get their Letter 6419 to file, which shows how many payments one received.
Those should be delivered to all families by the end of the month.
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