5 tax law changes to know

| May 7, 2021 | Tax Law |

If you need assistance with your taxes, it’s important to work with a knowledgeable team. The Internal Revenue Service is not very forgiving, and making mistakes could lead to serious allegations, fines and penalties.

Most years, there are changes to tax laws, and those could influence your taxes as well. For example, the Tax Cuts and Jobs Act of 2017 made international tax law changes. In 2021, income limits for claiming deductions will increase, and employer-sponsored retirement contribution limits will increase.

What are some other tax changes for 2021?

Some additional tax changes for 2021 include:

  • Changes that impact your IRA, such as a maximum deduction reduction at $65,000 and elimination at $75,000 for a single filer
  • Changes to income limits for contributing to a Roth IRA, with a maximum contribution reduced once your modified adjusted gross income reaches $125,000 as a single filer
  • Higher standard deductions for all filing statuses
  • No personal exemption due to the Tax Cuts and Jobs Act

It’s important to keep track of these changes, since adapting your taxes could help you save money and even invest more into yourself and your future.

Is it worth talking to a tax attorney about major tax changes?

Yes, it is. If you’re running a business and need to file corporate taxes or are handling your personal taxes while living abroad, you’ll want to have an attorney help you with the right forms and information on the changes that have occurred. Since tax rules change annually, it’s a good idea to review those changes to see if they could have a positive impact on your tax return.

It’s true that not all changes to taxation are positive, and many may negatively impact people. Tax attorneys take time to look at these new laws closely, so they’re better able to suggest changes to your tax forms that may benefit you while staying within the law.

Taxes are complex, but with the right help, you can take steps to protect yourself and save more money. Knowing the changes may help you avoid trouble with the law and IRS as well.