NORFOLK, Va. - On top of all we're already dealing with — COVID, getting the kids back to school, paying leftover holiday bills — add taxes to the list.
Tax season begins January 24 with an April 18 deadline, this year.
Kevin Zywna, a Certified Financial Planner and President of Wealthyway Financial Advisors in Norfolk, says the Biden administration's Build Back Better bill would have changed tax brackets and tax rates, had it passed before the new year.
Because it didn't, Zywna tells News 3 any changes we see in our returns this year will largely come down to what's happening in our lives.
"If you have a child that's been born, that's a change. If you get married or if you get divorced, those are significant changes that will impact your taxes," said Zywna, who also says job loss or change can also affect them.
Two other changes are also likely to impact your return, he says:
- In 2021, qualifying families could receive the first half of their Child Tax Credits early in monthly payments. Those who did will only receive the second half when they file.
- Those who chose to delay their student loan repayments would lose the tax deduction that would have come with paying interest.
As for how what we can do now to impact our returns, Zywna says investing extra cash into an Individual Retirement Account (IRA) is a possibility for those who qualify as long as it's done before the tax deadline.
It's also a good time, he suggests, to start thinking about next year's return.
"Start contributing to the company retirement plan or increase the amount you're contributing to the retirement plan. That comes out pre-tax, which means you get a tax deduction for that and you're building up your net worth for your retirement down the road," Zywna tells News 3.
And remember, people with a low enough income — often those who live on social security alone — do not technically have to file taxes, but filing is still a good idea, Zywna says, because it gets your information into the government's system.
