There are a few things to keep in mind this coming tax year:

1. The American Rescue Plan authorized advance payments of the Child Tax Credit starting in July of 2021. If you received advances of the credit your tax refund may be lower this year. Also, if you received more than you should have, you may have to pay some or all of it back. So, if you received any payments, please let us know the total amount to avoid any complications. The IRS just sent out a Letter 6419 showing the total advance payments you received, so please include this with your tax preparation material.
2. The 3^rd round of stimulus payments started going out in March of 2021. This was an advance on a 2021 tax credit. If you received less than you were due you will be eligible for a credit on your 2021 tax return, so be sure to let us know how much you received. The IRS sent out a Letter 6475 to everyone who received a payment, so please include this with your tax preparation material.
3. If you were eligible and received PPP funds in 2021, we will need to include this information on your tax return, including the amounts granted and amounts forgiven.
4. In 2020, the first $10,200 of unemployment was not taxable for many people. There’s no such provision in 2021, so if you received unemployment, be aware that that money is fully taxable this year.
5. Both the IRS and Hawaii have made it easier to make payments online. IRS payments (including estimated payments) can be made at irs.gov/payments. You can either pay with a bank account at no cost, or pay with a credit card with fees Hawaii payments can be made at hitax.hawaii.gov. Click on “Make a Payment”, and the website will ask for some information to confirm it’s you.
6. In the near future, it will be harder to set up an online account with the IRS. An online account is useful to have in case you need to look up past tax returns, check account payments and balances, IRS letters, etc. The IRS is moving to a 3^rd party authenticator called ID.me (to set up an account, go to https://www.irs.gov/payments/your-online-account, click on “Sign in to your Online Account”, then click on the “Create an Account” button). Beginning in the summer of 2022, this will be the only way to access your IRS account and it’s a pain to set up, so it’s recommended that you set up an account before you’re in a time sensitive situation.
7. Please be sure to fill out the Tax Worksheet (as best you can and whatever applies to you) before coming in to your appointment. The worksheet can be found on our website under “Resources”.
8. Lastly, a note on the secure portal system on our website. If you just want to send and receive messages you can, but the messages (and attachments) disappear after 14 days. If you create a username and password, the messages won’t expire.

We look forward to helping you adapt and take advantage of all the new changes in the tax world. We appreciate your trust and aloha.