ST. LOUIS — The last year proved the old adage that few things in life are certain, but taxes still make the list.
“2020 has been anything but routine or normal, and with that will come changes to a lot of people's individual tax returns,” said Dan Schindler with Anders CPA.
In very 2020 fashion, the timeline for when you file might need to be flexible.
“There’s a little strategy involved,” said Schindler.
That's because of talk in Congress of a third stimulus check that could roll out right in the middle of tax season — expected sometime in early to mid-March.
Though lawmakers are still ironing out details, payments could be up to $1,400 for those who qualify. Under the current plan, that’s people who make less than $75,000 per year, and that amount would decrease for people making between $75,000 and $100,000. The treasury would issue those payments based on 2019 or 2020 tax returns, whatever is the most recent on file.
This is where the strategy comes in.
“If you are on the verge of qualifying or not qualifying for this potential upcoming stimulus check, you may want to consider accelerating when you file your 2020 tax return, or delay filing or 2020 tax return, just depending on what your income level was in 2019 versus what is expected to be in 2020, said Schindler.
If you made more in 2020 than in 2019, you could stand to get more stimulus money if you wait to file until closer to the April 15 deadline. That’s especially true if you make between $75,000 and $100,000.
If you made less last year, file sooner. Filing earlier is also the better option if you had a child in 2020 (another dependent who may qualify for stimulus money), if you are still waiting for either of the previous stimulus checks (which will be paid out to you in your return), and if you're expecting a refund and want it sooner than later.
“Take a step back and look at how did my personal situation change and what can I take advantage of with the changes and opportunities that came about via stimulus packages?” said Schindler.
As a reminder, if you received unemployment checks in 2020, that is considered taxable income, but the stimulus checks aren't taxed.
You can now file your taxes with the IRS. For more information, click here.