Monthly News: May 2021

The IRS has expanded the dependent care credit.  The credit has been expanded in several ways.  The maximum amount of eligible expenses has almost tripled. The maximum rate has increased from 35 percent to 50 percent. Currently the new dependent rules are only for 2021.

The IRS is looking for stimulus fraud and ineligible payments. Unfortunately, identity thieves began taking advantage of the stimulus by filing fraudulent returns.

Many people received stimulus who were ineligible. This included people who were deceased and to ineligible dependents. It is estimated that 4.4 million potentially ineligible payments have been made to individuals as of July 16, 2020.  The IRS has added instructions to its website to provide information about how to return the stimulus payments.

The IRS is looking for crypto currency tax cheats.  If you have been trading crypto currency, you should consider the consequences of nor reporting the income. The IRS is taking this tax evasion seriously. There are two new efforts by the IRS which show the seriousness of the IRS and the direction they are taking.