News and Updates

As part of the American Rescue Plan Act that was signed into law in March, the IRS is required to assist taxpayers with children by making periodic, and non-taxable, advance payments from July through December of 2021.  These payments will be equal to half of what the IRS estimates eligible taxpayers will receive in child tax credit when they file their 2021 return next year in 2022.

Letters were/are being sent to families, based on their 2019 or 2020 filed returns Adjusted Gross Income (or who used non-filer tools to register for economic impact payments), letting you know of your eligibility and an estimate of what the monthly payment will be.

Payments will begin being direct deposited or sent via paper check starting July 15th and will arrive every month around that time depending on weekends and holidays.  So when you see a deposit in your bank account from the IRS and you may not be sure why, it’s the Child Tax Credit advance payment.

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The RELIEF Act of 2021 is an emergency economic impact and tax relief package that will provide more than $1 billion for Maryland working families, small businesses, and those who have lost their jobs as a result of the COVID-19 pandemic.

RELIEF Act Economic Impact Payments

The RELIEF Act includes direct economic impact payments for low to moderate income Maryland taxpayers who filed for and received the Earned Income Tax Credit (EITC) on their 2019 Maryland State Tax Return. These economic impact payments will be issued by the Maryland Comptroller to all qualified taxpayers. No application is necessary to receive this relief.

Relief payments will be made to Maryland residents who claimed and received the EITC on their 2019 Maryland state tax return. Maryland taxpayers who claimed and received the Earned Income Tax Credit had the following annual earnings: 

• $50,954 ($56,844 married filing jointly) with three or more qualifying children;
• $47,440 ($53,330 married filing jointly) with two qualifying children;
• $41,756 ($47,646 married filing jointly) with one qualifying child;
• $15,820 ($21,710 married filing jointly) with no qualifying children

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COVID-19 Relief Law Boosts Temporary Tax Deductions and Credits

Embedded in the COVID-19 relief law is $900 billion for financial assistance.

As you would expect in these unusual times, some of the relief is in the form of direct government financial assistance and some is from tax benefits that can impact both tax year 2020 and tax year 2021.

Most of the provisions create extra deductions or credits where Uncle Sam puts cash directly into your wallet.

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Who Qualifies for First-Draw PPP Money Today?

Two things to know about the Paycheck Protection Program (PPP) first draw enacted on December 27, 2020: 

• The first draw is for those who missed getting in on the original PPP, which expired on August 8, 2020.
• Don’t think of a PPP draw as a loan. It’s not a loan. It’s a cash infusion. You have to repay a loan. You don’t have to repay the PPP funds.

Who qualifies for first-draw PPP money today? You, most likely—if you file a business tax return and have not yet received any PPP monies.

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At the end of 2020, the new $900 billion coronavirus relief package became law. This relief expanded the existing “Economic Impact Payment” program with an additional $600 stimulus payment to taxpayers provided that they had previously filed a 2019 tax return. Unlike the first economic impact payment released in April of 2020 where the IRS determined the amount of the payment based on either a taxpayer’s 2018 OR 2019 tax return, this payment is again only based on the taxpayer’s 2019 tax return.

So that we can help you avoid getting costly repayment letters from the IRS, it is imperative that we know the exact amount of stimulus payments you receive in both the first round and second round payments. Please save proof of payment and provide it with your tax documents this year for verification.

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We are super excited to be rolling out a brand new client portal system this month to replace our current client portal. Our new portal system is from a company called Canopy, and just like our current portal, it will be the most secure gateway for you to send us important documents and for us to send you important documents.

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Hi Friends, what a crazy year it’s been!

In January 2020, I thought my largest challenge would be running the practice my mother founded, with her now in retirement. Turns out I was wrong. I could not have predicted the challenges that have faced us all. While we met with many of you in person this year, we did close the office to the public starting in March 2020 for a virtual tax year and it worked out well for everyone.  

As I think about this past year and all of the people that I’m so lucky to have as a part of my life (my family, my staff, my clients), I can’t help but think of their safety and well being. It’s become an inescapable fact that we will continue to deal with this pandemic for a while longer. Most experts say that the soonest the general population will have had the chance to be effectively vaccinated will be April or May of next year. So after much thought and discussion with staff, we have made the decision to keep the office closed to the public (and continue to have virtual tax appointments) until at least May 2021 so that we can keep our staff, clients, and families as safe as possible.

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We wanted to let you know that we are still processing 2019 tax returns.  It has been quite a year between shutting down the office because of Covid-19, all of our staff continuing to work from home, the stimulus packages passed by Congress and the myriad of loans and employee protection programs we have had to navigate over the past few months for our clients.

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