COVID-19 and Your Taxes: Everything You Need to Know
At the beginning of 2020, when the world was hit with the COVID-19 pandemic, there was a lot of uncertainty. People were forced to work from home, or even worse, lost their jobs. This unemployment didn’t have an end date, which left a lot of Americans in a scramble.
It’s been reported that only 40% of Americans can cover a $1,000 unexpected expense. This means that more than half of Americans were hurt by losing their jobs because they didn’t have savings. The IRS and the government have done a couple of things to help support those who fit into this category.
We’re going to tell you about the American taxes and COVID-19.
Later Filing Deadline
Many Americans don’t file taxes because they don’t have the funds. Many self-employed or business owners owe money at the end of the year, but these individuals don’t save to pay for it.
However, this can lead to problems with tax evasion or fraud. If you need assistance on filing taxes, navigate to this website for help.
With the coronavirus outbreak, people needed to use the savings they had to be able to live. There was no extra money to pay for their taxes by the April 15th tax date. In 2020, the deadline was extended to July 15th to ease the stress that so many people were under.
As much as COVID-19 is a health concern, it’s also a huge economic problem. People are making less money, which means they aren’t spending as much, and all of this affects the economy.
As a way to help the American people, the government gave a one-time $1,200 stimulus package check for individuals and additional coverage for those with children. The amount you received was based on your 2018 or 2019 tax information.
If you didn’t file taxes in those years, it’s possible you didn’t receive this much-needed relief. This stimulus package isn’t considered income, so when you file your 2020 taxes, you don’t need to claim this or pay it back.
Small Business and Self Employed Assistance
The biggest group that was hurt financially during the pandemic were the small businesses and self-employed. Non-essential companies were forced to close their doors, and those without work were limited on what they could do.
The government created a loan for those affected by the pandemic to reopen when it was right. Also, when you file your 2020 taxes, you might be able to be repaid in the form of a tax credit for sick and family leave.
The IRS and the US government are trying to ease these individuals’ financial burden because of COVID-19 with some tax reliefs.
The Bottom Line
The global pandemic has impacted the world in so many ways. Besides the devastating amount of deaths, the financial crisis is real. The nation has tried it’s hardest to help those in need with specific tax breaks.
The United States moved the tax filing deadline back, gave the people a stimulus package, and provided aid to small businesses and the self-employed. These effects have helped, and we hope that if the pandemic goes on further, more relief will be given.