COLUMBUS, Ohio (WCMH)– Falling in line with the rest of the year, the 2020 tax-filing season will be different than in years past. The date to start filing taxes was pushed back Friday by the IRS, and once that window opens up, calculating your taxes will be different, too.
Owner and President of BBI Accounting in Columbus Jerry Rhodes says the biggest challenge people are going to have this year is reconciling stimulus payments.
Rhodes answered more common questions about filing 2020 taxes:
Q: Do you need to report COVID-19 stimulus money?
A: Yes, but not as income.
“It does not necessarily count as income, but we have to reconcile if people who should have received it, did receive it and if they didn’t, they can claim it when they file their returns. We need to make sure people who shouldn’t have received it and did receive it have a way of paying that back,” Rhodes explained.
Q: Can you write off money spent on making a home office?
A: Not unless you’re self employed.
“If you’re self employed, you can always claim a home office deduction, but if you’re furloughed or working from home for a major employer and you get a W2 every year, there’s not necessarily an advantage for that unless your employer agrees to reimburse you,” said Rhodes.
Q: Do you have to pay taxes in the city your office building is in for the months you worked from home?
“This is still under contention,” Rhodes stated. “Columbus has made a pretty strong argument that they should continue to hold Columbus city payroll tax for people who were working in the city and would otherwise still be working in the city of Columbus. I’m sure that’s up for debate, up for renegotiation for 2021 if people who are definitely decide they’re not coming back to the office in downtown or anywhere in Columbus. Perhaps they’re going to continue to work from home in a suburb.”
Q: Is writing less money off for childcare going to impact potential refund amount?
“That’s always possible, but keep in mind the childcare credit is a pretty small credit on an individual’s tax return. I’m not saying it’s not large for some people, but they maximum childcare credit is $600 per child,” added Rhodes.
Q: Will paying less student loan interest going to impact potential refund amount?
“The maximum student loan interest deduction is $2,000. If you deduct that from your taxes, you’re probably saving a couple hundred dollars… and some of those loans could have gone into forbearance which mean that maybe someone would have had a $2,000 student loan interest deduction and it goes down to $0. It’s going to have an affect on the scale of the hundreds on their return,” explained Rhodes.