What you should know about the 2021 child tax credit

The American Rescue Plan passed by Congress in March of 2021 included important changes to the child tax credit. Prior to its passage, the child tax credit was $2,000 per qualifying child with up to $1,400 available as a refundable credit. In 2021, the credit has been increased to $3,000 per qualifying child between the …

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Free eBook offers details on COVID economic resources

Looking for all finance related COVID-19 information? Since the onset of the pandemic, multiple aid packages, legislation, guidance, deadlines, caps and more have been issued, changed or suspended. It’s enough to make your head spin. Henry+Horne has stayed on top of the changes so you don’t have to and we’ve compiled it all into a …

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Community property and tax exempt unemployment compensation

Becoming suddenly unemployed was an unfortunate first-time experience for many during the COVID pandemic. While the worst of it seems to be behind us, at least in the United States, there are many ongoing reasons for losing one’s employment. Preserving your income and assets during periods of unemployment is important and that includes doing what …

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COVID-19 funeral assistance available

One of the tragic and rarely talked about consequences of the pandemic has been the added financial burden families have had to shoulder after suffering the loss of a loved one to COVID-19. For many who were struggling before the pandemic or may have also suffered economic hardship due to the pandemic, this added expense …

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IRS refunding taxes paid on pandemic unemployment

Good news for those of you who collected pandemic unemployment last year and already filed your 2020 taxes. You might be getting a refund! The American Rescue Plan Act enacted in March made unemployment benefits up to certain thresholds tax free. The IRS recently announced beginning in May it will begin issuing automatic refunds for …

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Pandemic emergency financial aid grant not taxable

Did you receive a pandemic emergency financial aid grant due to the COVID-19 pandemic? Good news! Those grants aren’t included in your gross income. The IRS recently released FAQs on how to report pandemic related grants. While the grants aren’t taxable income, students shouldn’t reduce the amounts they paid in qualified tuition and expenses by …

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The new stimulus act – What’s in it for you?

The American Rescue Plan of 2021 was signed into law today. Here’s a summary of what’s included. Round 3 of Stimulus Payments Subject to the below limits, individuals will receive a $1,400 payment, couples $2,800. Also, in this round dependents receive $1,400, including adult dependents. Similar to the last two rounds of stimulus, payments begin …

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Families with ITINs eligible for stimulus checks

When the first round of stimulus checks, known as the Economic Impact Payment, were issued in 2020 families who filed a joint tax return were not eligible if one spouse had an Individual Tax Identification Number (ITIN) instead of a Social Security Number (SSN). This left many families out, especially those families with one spouse …

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Ending a partnership

Unfortunately, due to COVID-19, a lot of businesses have made the difficult decision to close their doors. If you are a partner in a partnership structure, several steps need to be taken and boxes checked to make sure the business is permanently closed. Below are the steps the IRS lays out to close a partnership …

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Planning for stimulus

Will there be a third round of stimulus? While the White House and the Congress discuss such things, enough rumor is flying around that we need to plan for a potential third round of stimulus. As many realize, the official start of tax season was much later this year – February 12 – partially because …

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