Rhodes, Young, Black & Duncan, CPAs

To claim a deduction for a donation of $250 or more, you generally need a contemporaneous written acknowledgment from the charity. Contemporaneous means the earlier of the date you file your income tax return, or the extended due date of your return. If you made a donation in 2020 but don’t have a written acknowledgment, you can request it from the charity and wait to file your 2020 return until you receive it. Additional rules apply to certain types of donations. Keep in mind that under a 2020 law, taxpayers who don’t itemize deductions can claim a federal income tax write-off for up to $300 of cash contributions to IRS-approved charities for the 2020 tax year.

If you have a traditional IRA or tax-deferred retirement plan account, you probably know that you must take required minimum distributions (RMDs) when you reach a certain age. Once you attain age 72 (or age 70 before 2020), you must begin taking RMDs from traditional IRAs and certain retirement accounts. If you don’t withdraw the minimum amount each year, you may have to pay a 50% penalty tax on what you should have taken out but didn’t. In order to provide tax relief due to COVID-19, the CARES Act suspended RMDs for calendar year 2020 but only for that one year. That means if you’re required to take RMDs, you need to take them this year or face a penalty. Contact us if you have questions.

The IRS is opening the 2020 individual income tax return filing season on Feb. 12. (This is later than in the past because of a law that was recently enacted.) Even if you usually don’t file until closer to the April 15 deadline (or you file an extension), consider filing early. It can potentially protect you from tax identity theft. In these scams, a thief uses another person’s personal information to file a fraudulent return early in the filing season and claim a bogus refund. Another benefit of early filing is that if you’re getting a refund, you’ll get it faster. And if you were eligible for an Economic Impact Payment last year and didn’t receive it, you can claim it on your 2020 return.

This past Saturday, we put our core value of Community Involvement into action in a new way by spending some time cleaning up our local roads. We are thankful to Gwinnett Clean & Beautiful for assisting us in coordinating this effort. It was a beautiful, fulfilling day for our team.