Covid-19 Tax Updates For Individuals


Beware of Scammers!!

The IRS does NOT call or email asking you to verify or provide your financial information. Do NOT click on any links in an email that looks like it is from the IRS and definitely do NOT click on any attachments.

Seniors are the most vulnerable to these scams, so please educate your loved ones to be extra vigilant about protecting their personal and financial information.

To learn more, visit https://bit.ly/2XEr5Oy and check the IRS website regularly for updates.

Extended Filing and Payment Deadlines

For more information on tax deadlines and extensions visit these links:

IRS

Pennsylvania Department of Revenue

NJ Division of Taxation

For information on local tax deadlines and extensions, please check the website of your local tax authority.

2020 RMD Waiver

Retirees will get a benefit from the coronavirus stimulus package, also known as the CARES act, in the form of a waiver from taking their required minimum distribution from retirement accounts for 2020. The waiver applies to anyone with an RMD due in 2020.

This not only allows for the deferral of income tax, but also provides help for retirees who would be forced to withdraw from their retirement accounts while the stock market is in a downturn. The RMD waiver also provides a planning opportunity for those who may choose to take a retirement distribution in order to get the benefit of a low-income tax bracket.

Low market values may also make this a prime opportunity to convert your traditional IRAs into Roth IRAs. This is an excellent opportunity for tax planning. Contact your tax advisor at Diamond & Associates, PC CPAs for more information.

Economic Stimulus Checks

The CARES Act mandated Economic Impact Payments for US citizens and resident aliens of $1,200, or $2,400 if they filed married filing jointly, and met certain filing requirements and certain income limitations.  Stimulus payments are not taxable and are actually an advance on a tax credit for 2020.  Why is that important?  If you did not qualify for a stimulus payment based on last year’s AGI, but experience a reduction in income in 2020 you may be able to claim the stimulus payment as a credit on your 2020 return.

Expanded Unemployment Insurance

The CARES Act added $600 to weekly unemployment benefits for individuals entitled to receive state unemployment compensation. After the supplementary benefits originally authorized expired on July 31, 2020, President Trump’s “Lost Wages Assistance” provided an additional $300 weekly through September 14, 2020.  For individuals who have previously collected state or federal compensation but have exhausted those benefits since July 1, 2019, Pandemic Emergency Unemployment Compensation (PEUC) provides another 13 weeks of support.

Visit the PA Office of Unemployment Compensation website for employees impacted by COVID-19.

For more information on the PEUC program in Pennsylvania visit the website.

For the PEUC program in New Jersey see the Division of Unemployment Insurance Benefit Extensions page.