New Tax Law Comparison Summary - The program will include a tax provision summary of the new tax provisions affecting 2021 tax returns. It will include updated information for the 2021:
- Recovery Rebate Credit
- Child Tax Credit
- Child and Dependent Care Credit
- Earned Income Credit
- Premium Tax Credit
New Questions When Creating a Tax Return
- Did the taxpayer or spouse have a home in the U.S. for more than half the year? (to return to this question after creating the tax return, select Personal Information > Name and Address > Lived Half the Year in U.S.)
- In order to qualify for the 2021 enhanced child tax credit and enhanced child and dependent care credit, the taxpayer or spouse must have lived in the U.S. for at least half of the year. Military personnel on active duty outside the U.S. are considered to be living in the U.S. during the duty period.
- Taxpayers answering No to this question may still qualify for the credits, but will not be entitled to the enhanced credits for 2021.
- Advance Child Tax Credit Amounts from Letter(s) 6419
- The amounts entered will be used to reconcile advance payments received.....
- Does the taxpayer qualify to receive a recovery rebate credit on their 2021 tax return?
- The third round of economic impact payments made are reconciled on the 2021 tax return.
Personal Information Menu - Married Filing Separate (MFS) - A menu item has been added to the Personal Information > Other Categories Menu for MFS taxpayers.
- MFS and meets requirements to claim the EIC. - MFS taxpayers qualify to claim the earned income credit using the rules for taxpayers with no qualifying children if they either:
- Did not have the same principal residence as their spouse for the last six months of the year; or
- Are under a separation instrument and did not live in the same household as their spouse as of the end of the year
Form 1040 - New Layout / New Menus
- Schedule 1 is now a 2 page form. Part I is used to report additional income items. Part II is used to report adjustments to income.
- The Other Income Menu in the program has been expanded to match the new Schedule I
- The Adjustments Menu has also been expanded to match the new Schedule I
- Tuition and Fees Deduction (Form 8917) is obsolete & has been removed for 2021.
- Charitable Contributions if you take the Standard Deduction is removed from the Adjustments Menu and added to the Deductions Menu.
- Schedule 2 in now a 2 page form. Part I is used to compute tax. Part II is used to report Other Taxes.
- The Additional Taxes Menu has been expanded to match the new Schedule 2.
- Schedule 3 is now a 2 page form. Part I is used to claim non-refundable credits. Part II is used to claim refundable credits.
- The Credits Menu has been expanded to match the new Schedule 3.
- Several Refundable Credits and Payment items have been moved to Other Payments or Refundable Credits.
- The Itemized Deductions Menu is now the Deductions Menu. It includes:
- Itemized Deductions on Schedule A
- Charitable Contributions for taxpayers taking the standard deduction
- The Qualified Business Income Deduction (Form 8995)
New Forms
Form 9000 - Alternative Media Preference
Form 8915-F - Qualified Disaster Distributions (Replaces Form 8915-E)
Schedule K-2 (Form 1065, 1120-S, 8865)
Schedule K-3 (Form 1065, 1120-S, 8865)
Fees
Filing Status Fees - Option to set a default fee based on filing status
Additional Information: