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2021 Tax Season: What You Need to Know

One constant encountered every year, other than birthdays and holidays is Tax Day, and most importantly tax season – the official period between the first day you’re allowed to file your taxes to the last. Many of us begin thinking about tax season as soon as we receive our W-2s which employers are required to furnish by January 31 but, not this year. The 2021 tax season has been delayed.  

Many Americans are asking, “When is tax season 2021?” 

The start of 2021 tax season has been changed to February 12. This is the earliest the IRS will begin processing returns which in previous years started in January. The reason for the delay has been attributed to a backlog of unprocessed returns from the previous year, in addition to stimulus payments, and insufficient staffing. Furthermore, if you’re one of the lucky ones expecting a refund, according to IRS.gov, it will take longer than usual to process mailed tax returns. 

Advantages of a Refund Advance

Because in times like these, there is no guarantee of a timely refund, a refund advance may be the answer for many families. The money you’re anticipating from a refund becomes available to you immediately, eliminating the extended wait time from the IRS. You can have your refund in your hands a lot sooner than if it were mailed or deposited into your bank account. 

You’re probably wondering how a refund advance works. It’s really very simple. You’re provided a loan in the amount of your refund which is automatically repaid by your refund when it becomes available. Once your lender receives the refund, your loan is paid off. Refund advances are common and gaining acceptance by more and more taxpayers especially in these unprecedented times when people need the money most. 

Getting Your Tax Refund Started

Now is the time to consider not only a refund advance but, electronic filing. Electronic filing is now more important than ever, and it’s being encouraged by the IRS. With electronic filing, refunds can be deposited directly into your bank account providing quicker access. More and more professional tax preparation services like Sun Loan are offering these e-filing services to help file your taxes.

If you’re unsure about the electronic filing process, it’s understandable but, given the challenges we’re facing today, including the delay of tax season and processing times for paper returns, it’s time to give e-filing serious consideration. Today, e-filing is considered safe, secure, and accurate. There’s no need to further the delay of your refund caused by changes to the 2021 tax season.

First thing’s first.

Who needs to file taxes?

Let’s figure out whether you’re even required to file a tax return at all. This is important to know because when you don’t file, you could face dire consequences later when it’s discovered by the IRS. It’s also important to be sure that no one else is claiming you on their taxes to avoid confusion with the IRS. Information on IRS.gov includes an interactive tax assistant, or interview to help you determine whether you should file. This interview lists several, short questions that only take a minute or two to complete. They include questions on your marital status and gross income for the previous years. If completed accurately, you’ll know whether you’ll need to file a federal tax return by the end of the interview.

What are the advantages to filing electronically?

We recommend e-filing because it is the quickest service available and you can get your refund direct-deposited into your account. If you mail your return, then you’ll also receive your refund through the mail which means, in addition to the time it takes for the IRS to process your return, you will also be waiting an additional four to eight weeks for it to arrive in the mail. E-filing is simply a way to submit your tax return through a tax preparation software. The IRS receives your return promptly and your refund can be deposited into your bank account. You could have your money the next day, although this time varies.

What documents do I need to file taxes?

Professional tax preparation services, like Sun Loan, will ensure you have everything you need before starting your tax return. Our tax services are quick and easy and take the stress out of having to do it yourself. We also offer year-round support, not just during tax season, and can prepare your taxes with no up-front fees.

       Prior to coming in, it’s important to bring the necessary documentation. These documents include:

  • W-2 form(s) (Or, if you were unemployed, you’ll need your state tax refund)
  • SSN(s) (Spouse’s and all dependents’ identification: Social security number
    or tax ID number, and dates of birth)
  • Photo ID (Driver’s license, passport, or state identification cards)
  • 1099 form(s) (Independent contractors and business owners)

 

What if I don’t file my taxes?

COVID-19, furloughs, and layoffs have made it hard on many of us. It may be tempting to skip your federal tax return especially if you owe money. Unfortunately, it’s necessary to pay your taxes every year, and early if possible. This year, February 12, will be the earliest you can begin filing so, if you have your W-2, hire a professional tax preparer like Sun Loan. It will remove the risk of filing late or not at all. Even if you think you owe and can’t afford to pay the IRS back, you still need to file. Payment plans or installment agreements are normally accepted by the IRS, and any experienced tax preparer can advise you on the process.

Other Reasons You Should File Your Taxes 

It’s harder than ever to get away with not filing – Various institutions such as banks and all employers are required to report what’s considered taxable income to the IRS. Other than employment taxes, this often includes early withdrawals from retirement savings and interest payments from investments. If you owe taxes, the IRS already knows.

The longer you wait to pay your taxes, the more serious the consequences – Even if you don’t owe, you are still required to file a tax return and can file an extension if you need more time. 

Get the money you’re owed – Consider all the things you could do with your refund. Use it to pay off medical bills, and other expenses, or do something fun with the family. Using Sun Loan’s e-filing, tax preparation services you’ll have your refund in your hands in no time and the reassurance that it was done accurately. 

Begin Filing Your 2020 Tax Return on February 12, 2021

While you’re waiting for February 12 to roll around (the first day to file taxes in 2021), begin compiling all the documents you’ll need. Tax Day will be here before you know it but, there’s no need to wait. The sooner you file your return, the sooner you’ll get your refund. Last year, Tax Day was extended through July, but Tax Day 2021 may still remain April 15.

Tax season is daunting, and like the other nearly 150 million Americans filing their taxes this year, you probably have a lot of questions. Our advice is to partner with a certified tax preparer like Sun Loan. Visit any of our Sun Loan locations offering tax preparation services and let our team help take the stress of filing off your shoulders. E-filing is quick, safe, and easy. Let us help you get the money you’ve worked so hard for all year.