There new American Rescue Plan is all about your tax return. There are 3 major items that impact most Americans
1. $1,400 stimulus payments to taxpayers and dependents under 17. AGI limits are 80k for Single, 120k for Head of Household and 160k for Married filing joint.
2. Up to $10,200 of unemployment benefits for 2020 will be non-taxable if your AGI is below $150k (on your Federal return) Each State then has to decide if they are going to follow the Federal rules or not.
4/1/21 UPDATE - Michigan Department of Treasury advises Michigan taxpayers to "wait"
https://www.michigan.gov/treasury/0,4679,7-121--556084--,00.html
"The Department is waiting on further guidance from the IRS with respect to potential data sharing that may allow the Department to expedite Michigan income tax refunds to Michigan taxpayers. Taxpayers should not file amended Michigan income tax returns until the Department issues further guidance."
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3/31/2021 UPDATE - IRS will recalculate and amend affected returns
https://www.irs.gov/newsroom/irs-to-recalculate-taxes-on-unemployment-benefits-refunds-to-start-in-may
3. Child Tax Credit is expanded (presently 2,000 per child under 17, and 500 for 18+) to be $3,600 for each child under 6 and $3,000 for all others.
Also, note that the way that this new Child Tax Credit works is that it is intended to be paid out on a monthly basis, and the push is for the start date to be July 2021
These computations are going to be based on the most current information that is available, 2019 or 2020.
Doug Zandstra CPA, CFE, EA
Certified Public Accountant
Certified Fraud Examiner
Enrolled Agent
29 Pearl St NW, Ste 225
Grand Rapids, MI 49503
616 970 3000
dougzandstra.com
email dougzandstra@gm
