March News To Know

Advance Child Tax Credit (CTC) — Our recent article on the CTC helps explain the changes that need to be considered when filing your 2021 taxes. In order to appropriately record this credit and to avoid unexpected delays in return processing and refunds, you need to provide Form 6419 or a summary of the advanced payments you have received.       

Inflation and Your Taxes — Cost of living updates have been modified for 2022, including increased mileage allowances and retirement limits.            

As you prepare your documents, some things to consider:  

• Charitable Donations — Cash donations can directly impact your refund when it comes to your 2021 taxes. Donations made can be deducted up to specific amounts. Don’t itemize your taxes?  No worries, there are additional benefits for 2021.  
• Home Office Expenses –  Due to the pandemic, many of you have continued working remotely. Learn more on how self-employed taxpayers can deduct a portion of your home.  

• Business Meals – Enjoying eating out again? Certain business meals are now 100% deductible instead of 50%, and the same applies to employee shift meals. 

March Tax Deadline For Certain Types of Businesses 

The deadline to file taxes or request an extension for certain businesses — including partnerships, S corporations — is March 15. If you’re unable to file your business return by then, we’re happy to help you file an extension, which would extend your deadline to September 15. It’s important to note that extensions do not extend the payment deadline, so if you’re expecting to owe taxes, arrangements for tax payments should be made, including PTE tax (see below). 

PTE Tax. Who’s Eligible and Election Requirements 

There are opportunities for businesses to adjust their tax obligation (and increase their deduction) by electing to pay the Pass Through Entity (PTE) tax — a benefit that many states have enacted, including Illinois. This legislation allows for the company to pay the partner’s or shareholder’s income tax obligation and bypass the otherwise applicable federal cap limitation. In 2022 First quarter estimated tax due needs to be paid by the 2022 April 18 due date, with ongoing quarterly estimated taxes paid throughout the year.  

Stay safe & healthy,  

The CJBS Team