Here are some tax planning reminders for the end of the year.
- If you received unemployment benefits, remember that they are taxable for Federal and NOT for California and the additional $600 (now $300) never had taxes withheld (even if you requested withholding).
- If your PPP loans were forgiven, you may not claim any of those expenses as deductions (which may result in higher than expected income).
- If you have been directly impacted by Covid-19 and have taken coronavirus-related distributions from your retirement, the CARES Act allows for expanded distribution (up to $100,000 without penalty) and tax relief (the taxes you owe as a result of the distribution may be repaid over a 3 year period). Below is a link to who qualifies and more information:
Coronavirus Related Relief for Retirement Plans
- Required Minimum Distributions (RMDs) are not required in 2020. If you took some distributions, you have the opportunity to rollover those funds back into a retirement account under the CARES Act. Below is a link with more information:
Rollover Relief for RMD Under CARES Act
- Check your withholding
- Touch base with us before the end of the year to see what contributing to retirement plan may do for your taxes
- Check in with us to help you with your tax planning for next year