 Last week's speaker was Nicole Reiker who shared about some of the changes in 2021 taxes and what to expect in 2022. It's always best to get advice from the experts on the many laws and regulations on what is deductible and what is not. Changes minor – Mileage went down, self employment taxes cannot be pushed back, 100% for meals at restaurants 2021-22 extra benefit for businesses, 2020 charitable count up to $300. Now is at $600 for couple. Increase in child tax credits and proactive and refundable. Inflation limits were all bumped up as we calculate. There are many ways we have changed due to legislative measures this last year.
Early withdrawal penalties – expired, take money for retired benefit plan and make sure getting those funds moved, unemployment income is taxable.
IRS going to send out proactive correspondence, save all receipts. Economic stimulus payments two in 2020 and 1 in 2021 tax preparation issue.
Crypto currency and new disclosures and make sure discuss tax impacts. IRS focused on it.
Montana Changes: Montana considered more complex states for tax preparation. Very complex taxes. If you have an issue you have a voice in Montana. Benefit to most tax payers and tax simplification and made some positive changes. Some of these changes start in 2022. Not for 2021 returns but do reach to 2024. 15 montana tax credits are going away. College contribution credit won’t be available, alternative energy credits – not doing that anymore, very detailed and high cost of compliance. See initial dropping of tax rates a small drop for everybody. Student scholarship increases. Elderly homeowner, renter credit is for people over 65 and more people eligible and raised income amounts will be more generous. Property taxes offset through these.
2024 – more impactful changes will start happening. Many states follow this procedure. Filing status and federal returns will apply to montana returns. Fewer subtractions over all. Monday medical saving will no longer be written off. Go from 7 brackets to 2 brackets. Capital gains rates will change and will be calculated differently. Now going to be a subtraction from income. Taxpayers over 65 will subtract 5,500 from income.
Montana tax will start at federal tax income. Add up all income and take off deductions and get down to taxable income and where we set rates. Redo that calculation and itemized deduction system. Start work on Montana and won’t have to work through all the deductions. Alllow you to not go through the whole deduction. Federal standard is beneficial and do the same work for Montana. Should be simpler.
Going away – Interest exemption, partial annuity, first home buyers income, tips are subtraction, workers compensation, etc. all were adjusted. Simplifies the tax returns.
Questions: Are rates going down for tax advisors? Encourage people to do it without a professional and self prepared and used pre resource sin community.
Idea is to break even and not necessarily lower the tax preparation. Drop in clients because they are going towards self exploring. Self explanatory and technology has able to work for themselves. Accounts bring more complexity in your return and isn’t easy to do. Limited time and staffing and able to feel good and serve more people would be beneficial.
How transparent is the recreational and medical use of marijuana? Firm does not serve that industry and hope that back and forth in development. Lots of good tax products out there. University doing taxes free for people.
Reason to change filing separately. Would be better for Montana to do it sperate. Way tax brackets changing there should be less filings.
Many news articles and speculation out there for real estate boom. Estate or gift tax is combined. Exemption is high. Discussions of significant decrease to that number. 6 million per person charge. Rising inflation rates go up.
Everyone feels frustrated with congress and changes in tax laws. |
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