Extra Documentation for the 2020 Tax Season

December 9, 2020

If 2020 has taught us anything, it’s the need for flexibility – because even the best laid plans can be null-and-void as new circumstances develop. Unfortunately, Oklahoma is still in the midst of the COVID-19 pandemic, and therefore, we’re preparing for another unpredictable tax season. To reduce traffic in our offices and help keep our staff and clients safe, we encourage you to take advantage of our secure online portal, curbside pickup and delivery, or virtual meetings whenever possible. As you begin gathering information for your 2020 return, however, there may be some extra documentation we need.

Here are six important actions you might have taken this year that impact how we prepare your 2020 tax return:

  1. Did you receive a partial stimulus payment? If you were not paid your full 2020 stimulus payment, you might be able to capture the additional refundable credit on your return. We’ll need to know exactly how much you received to reconcile the difference.
  2. Did you file for unemployment? If you or anyone on your return received unemployment benefits in 2020 or had a fraudulent claim filed in your name, we need to know. You’ll receive a 1099-G for all unemployment benefits received in 2020, and we’ll confirm it accurately matches what you were paid.
  3. Did you take a COVID-related withdrawal from your retirement account? The CARES Act provided expanded distribution options and favorable tax treatment for COVID-related distributions from eligible retirement plans. However, it’s important your tax advisor know this information, so it’s noted appropriately on your return.
  4. Did you donate to charity? If you do not itemize, you are allowed a $300 “above the line” deduction for qualified charitable contributions, but you’ll need to provide receipts to take advantage of the deduction.
  5. Did your business elect to defer payroll taxes for 2020? The CARES Act allowed employers to defer the deposit and payment of the employer’s share of Social Security taxes and self-employed individuals to defer payment of certain self-employment taxes. This will require additional details for us to prepare your business tax return, so please communicate the deferment to your tax advisor.
  6. Did your business receive a Paycheck Protection Program loan? We’ll need to see all documentation related to your PPP loan including details on loan forgiveness.

As a reminder, Wymer Brownlee requires a signed engagement letter and updated client data sheet each year before we can begin preparing your return. All tax information is due by March 4, 2021 in order for us to attempt to complete your individual return by the April 15 deadline. Please give us a call if you have any questions or need to be set up on our secure online portal.

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