News and Tax Rates

There are 7 major changes for the 2021 filing year:

  

  1. No punishment for student loan help. As part of the COVID relief bill signed in March, this is no longer the case. Starting in 2021, loan cancellation for post-secondary education is no longer considered taxable income. This tax perk is expected to last through 2025, and it may become permanent And if your employer helped you pay down your student debt faster, you can exclude up to $5,250 of that money. This is another temporary benefit that started in the 2020 tax year and has been extended through 2025.

  2. Higher deductions for medical costs. It's back to 7.5% for medical expenses.  

  3. Boosted Child Tax Credit: The government increased the credit to a maximum of $3,000 per child 17 and under, and $3,600 for children five and under. These credits are fully reimbursable.

  4. Higher Standard Deductions: $12,550 for single filers and married couples filing separately. $18,800 for heads of households. $25,100 for married couples filing jointly.

  5. Updated Tax Brackets: Tax rates remain unchanged for 2021, but the brackets themselves expanded to account for inflation.

  6. Required RMD's are back and must be taken at age 72 to avoid 50% tax penalty. 

  7.  Get the $300 charitable deduction even if you don't itemize. This is per person. Married couples can deduct up to $600 on their return.

Tax Scams/Consumer Alerts

If it sounds too good to be true, it probably is!
In recent years, thousands of people have lost millions of dollars and their personal information to tax scams and fake IRS
communication.

REMEMBER: The IRS doesn't initiate contact with taxpayers by phone calls, email, text messages or social media channels to
request personal or financial information.  In addition, IRS does not threaten taxpayers with lawsuits, imprisonment or other
enforcement action.  Being able to recognize these tell-tale signs of a phishing or tax scam could save you from becoming a victim.


THINK BEFORE YOU DONATE:

Here are the 'good guys' or, even better, choose to donate to a local shelter.

The American Legion National Commander receives a $0.00 salary

The Veterans of Foreign Wars National Commander receives a $0.00 salary

The Disabled American Veterans National Commander receives a $0.00 salary

The Military Order of Purple Hearts National Commander receives a $0.00 salary

These organizations with no salaries have donations going to help Veterans and their families. 

 

2021 Federal Tax Rates

For the 2021 tax year, the standard deduction is:

 $12,550 for single/married filing separately,

$25,100 for joint filers 

$18,800 for head of household

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