2020 – 09/17 How does the tax code define “dependent” for tax purposes? The IRS has finalized the definition based on changes brought by the Tax Cuts and Jobs Act (TCJA) for tax years 2018 through 2025. The definition of dependent includes a qualifying relative who meets two tests. The “income test” is met if the individual receives gross income below the exemption amount in effect that year ($4,150 for this purpose only. For tax calculations, the exemption is zero). The “support test” is met when an individual receives more than half of his or her support from the taxpayer. The child tax credit of $500 may be available for certain dependents including qualifying relatives who aren’t children.
Similar Posts
Bad Checks and the IRS
2020 – 08/24 Due to delays in processing, the IRS is providing relief from bad check penalties for dishonored checks it received between March 1, 2020, and July 15, 2020. The IRS says that if a taxpayer mailed a check (either with or without a tax return), it may still be unopened in the backlog…
Records Destroyed in a Disaster?
2020 – 09/29 Have some of your records been destroyed in a disaster? Records can help people prove their disaster-related losses. Past financial statements can be recovered from credit card companies or banks. Homeowners can get property-related documents by contacting their title or escrow companies, or the lender that handled their home purchase. Also, taxpayers…
IRS Resumes Enforcement Activities
2020 – 08/14 The IRS is partially resuming its enforcement activities. In March, the tax agency’s Small Business/Self-Employed (SB/SE) Division announced that it was suspending some enforcement activities due to the COVID-19 crisis. In cases where a taxpayer may have been affected by a disaster, the IRS could use “soft contact” procedures to contact the…
2020 Q4 tax calendar: Key deadlines for businesses and other employers
Here are some of the key tax-related deadlines affecting businesses and other employers during the fourth quarter of 2020. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing requirements. Thursday,…
Form 1099-C: Cancellation of Debt
2020 – 09/23 In an announcement, the IRS stated that lenders who make Paycheck Protection Program loans that are later forgiven under the CARES Act shouldn’t file Form 1099-C, “Cancellation of Debt” with the IRS or provide a payee statement to the eligible recipient as a result of the qualifying forgiveness. Filing such information returns…
