Personal Finance Coach: Did You Earn Less in 2020? A Step-By-Step Guide to a Bigger Tax Refund

TrustPlus
TrustPlus
Feb 3 · 4 min read
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With tax season starting on Friday, February 12, 2021, you’ll soon be able to file taxes and get that much-needed refund in your hands. Remember, the deadline to file is still April 15, 2021.

As we recently wrote, widespread unemployment in 2020 threatens millions of low-to-moderate income workers with up to 80 percent lower refunds for the Earned Income Tax Credit (EITC) and the Childcare Tax Credit (CTC) this year.

But thanks to a new “lookback” provision, tax filers who earned less in 2020 than in 2019 can use either their 2019 or 2020 income when filing this tax season, whichever yields the biggest refund. Note: only people who had less income in 2020 (compared to 2019) qualify for the lookback.

EITC and CTC are among the federal government’s largest anti-poverty programs for working families, lifting 5.6 million people out of poverty, including 3 million children in 2018.

We’ve put together a step-by-step guide to make sure you get the biggest refund possible, whether claiming EITC and CTC and filing yourself or using a tax preparer.

Before you file, make sure you or your tax preparer have access to your 2019 tax return! Don’t have access to it? Click here to learn more about how to get it.

Want to file your taxes for free? Check out the IRS Free File partners or speak with a tax expert at a Volunteer Income Tax Assistance (VITA) site.

Unsure if you qualify for EITC or don’t usually file taxes? Check out the IRS’ EITC Assistant to find out if you’re eligible and how much money you could receive.

Have additional questions? Talk to a TrustPlus personal finance coach for free.

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To see whether using 2019 or 2020 income yields you a bigger refund take the following steps at an IRS Free File partner of your choice:

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To ensure your tax preparer gets you the biggest refund possible, take the following steps:

Every dollar counts. Be sure to file your taxes, use the “lookback rule,” and don’t miss out on a potentially bigger refund!

Download a PDF of the Step-by-Step Guide

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The Road to Financial Empowerment

For nearly 25 years, our nonprofit social enterprise has…

TrustPlus

Written by

TrustPlus

TrustPlus is a financial wellness benefit that eases everyday money worries with human coaching and action-oriented tools and products.

The Road to Financial Empowerment

For nearly 25 years, our nonprofit social enterprise has been empowering workers to take control of their finances through financial coaching. Now we’re bringing our expertise to employers who want to support their workers’ financial health. www.mytrustplus.org

TrustPlus

Written by

TrustPlus

TrustPlus is a financial wellness benefit that eases everyday money worries with human coaching and action-oriented tools and products.

The Road to Financial Empowerment

For nearly 25 years, our nonprofit social enterprise has been empowering workers to take control of their finances through financial coaching. Now we’re bringing our expertise to employers who want to support their workers’ financial health. www.mytrustplus.org

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