MISSOULA — The COVID-19 pandemic didn’t just change our lives in 2020 -- it's also changed our tax situation.
The IRS website has page after page of things you need to know about filing this year’s taxes, especially if you got any help to get through the pandemic.
For example, you don’t have to pay income taxes on stimulus money, but you will be asked to report how much you received to make sure you got all you were entitled to.
But for those who used any kind of government help to stay afloat in the pandemic, there could be a tax bill in your future.
We sat down with Mike Combo -- a CPA with Anderson ZurMuhelen in Missoula -- to learn more about what people need to know about the 2020 tax season especially if they have never received unemployment benefits before.
“It is subject to tax on the federal level. The one silver lining, Montana does not tax unemployment benefits but on the federal side, you have to pay taxes on it,” Combo explained. “You could have elected to have withholding or not have it but both forms are taxable, even the extra $600 a week as well as the typical unemployment checks. The typical PPP loan, if you were forgiven, that’s not taxable and whatever expenses you paid on it are deductible.”
He suggests it is time to start getting your tax paperwork gathered as there is no indication the IRS is extending the tax deadline this year like it did last year.
You can join the conversation by visiting our Facebook page for our full discussion with Mike.
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