Tax Update and Reminders for 2022

As 2022 begins, we at Wouch Maloney are continually grateful for the opportunity to serve you.  We hope that you enjoyed the holiday season and had a chance to spend time (in-person or virtual) with family and friends. As always, as your trusted business advisors, we are here to assist you with navigating the ever-changing tax laws.

Items of Note

There are a few items specific to 2021 that could impact your tax filing including:

• The American Rescue Plan (The “Plan”), which was enacted in March 2021, provided a one-year expansion of the child tax credit. The credit increased from $2,000 to $3,000 for children ages 6 through 17 and $3,600 for children ages 5 or under. Half of these credits may have been paid in advance from July through December. The Plan also authorized a third round of stimulus checks (Economic Impact Payments) which provided much-needed relief during the prolonged COVID-19 pandemic.
• The IRS is sending letters regarding the 2021 advance Child Tax Credit (CTC) starting late December 2021 and continuing into January. The letter will include the total amount of advance CTC payments taxpayers received in 2021 and the number of qualifying children used to calculate the advance payments.
• Economic Impact Payment (EIP): The IRS will begin issuing letters in late January to recipients of the third EIP. This letter will help recipients of the third EIP determine if they are entitled to and should claim the Recovery Rebate Credit on their tax year 2021 tax returns that they file in 2022.

Tax Filing Deadline for Individual Returns

The tax filing deadline for 2021 individual returns (or extensions) is Monday, April 18, 2022.

WM WISDOM:
If you receive either the CTC or EIP letters highlighted above, please retain and provide a copy to us with your other tax documents in order to assist in the preparation of your return.

Tax Facts Chart and Earned Income & Business Privilege Tax Rates by County

To start out the new year, we have added two charts to our Resources page. First, the 2022 Tax Facts chart, which lists the various federal, state, and local tax rates and limits for payroll taxes, individual income taxes and other tax-related data.  The second chart shows the 2022 earned income and business privilege tax rates by county. We hope these charts are helpful to you and/or your business.

If you would like either of these charts in print format, please let us know and we will gladly send you a copy.

Keeping Up-To-Date

Please continue to visit our website and opt-in for our weekly updates for breaking news or important tax law changes. Also, if you are on social media, please follow us on LinkedIn, Facebook, Instagram or Twitter.

Should you have questions on any matters affecting you or your business, we are only a phone call or email away and always available to help.

We wish you all the best for a happy, healthy and prosperous new year.

DISCLAIMER: The WM Update, WM Wednesday Wisdom, WM Daily Update COVID-19, COVID-19 Business Resources, COVID-19 Client News Alerts and other related communications are intended to provide general information, including information regarding legislative COVID-19 relief measures, as of the date of this communication and may reference information from reputable sources. Although our firm has made every reasonable effort to ensure that the information provided is accurate, we make no warranties, expressed or implied, on the information provided. As legislative efforts are still ongoing, we expect that there may be additional guidance and clarification from regulators that may modify some of the provisions in this communication. Some of those modifications may be significant. As such, be aware that this is not a comprehensive analysis of the subject matter covered and is not intended to provide specific recommendations to you or your business with respect to the matters addressed.