Oct 1, 2021 — review the Temporary Provisions lesson in this publication. completion of a basic Form 1040 and associated tax forms.
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4491VITA/TCE Training Guide Volunteer Income Tax Assistance (VITA) / Tax Counseling for the Elderly (TCE) 2021 RETURNSTake your VITA/TCE training online at www.irs.gov (keyword: Link & Learn Taxes). Link to the Practice Lab to gain experience using tax software and take the certi˜cation test online, with immediate scoring and feedback. Publication 4491 (Rev. 10-2021) Catalog Number 47499R Department of the Treasury Internal Revenue Service www.irs.gov
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How to Get Technical Updates? Updates to the volunteer training materials will be contained in Publication 4491-X, VITA/TCE Training Supplement. The most recent version can be downloaded at: https://www.irs.gov/pub/irs-pdf/p4491x.pdf Volunteer Standards of Conduct VITA/TCE Programs The mission of the VITA/TCE return preparation programs is to assist eligible taxpayers in satisfying their tax responsibilities by providing free tax return preparation. To establish the greatest degree of public trust, volunteers are required to maintain the highest standards of ethical conduct and provide quality service.Annually, all VITA/TCE volunteers (whether paid or unpaid workers) must pass the Volunteer Standards of Conduct (VSC) certi˜cation test and agree that they will adhere to the VSC by signing and dating Form 13615, Volunteer Standards of Conduct Agreement, prior to volunteering at a VI TA/TCE site. In addition, return preparers, quality reviewers, coordinators, and tax law instructors must certify in Intake/Interview & Quality Review. Volunteers who answer tax law questions, instruct tax law classes, prepare or correct tax returns, or conduct quality reviews of completed tax returns must also certify in tax lawprior to signing the form. Form 13615 is not valid until the sponsoring partner™s approving of˜cial (coordinato r, instructor, administrator, etc.), or IRS contact con˜rms the volunteer™s identity, with a government-issued photo identi˜cation (ID), and signs and dates the form. As a volunteer in the VITA/TCE Programs, you must adhere to the following Volunteer Standards of Conduct::VSC #1 – Follow the Quality Site Requirements (QSR) VSC #2 – Not accept payment, solicit donations, or accept refund payments for federal or state tax return preparation from customer VSC #3 – Not solicit business from taxpayers you assist or use the information you gained about them for any direct or indirect personal bene˜t for you or any other speci˜c individual. VSC #4 – Not knowingly prepare false returns. VSC #5 – Not engage in criminal, infamous, dishonest, notoriously disgraceful conduct, or any other conduct deemed to have a negative effect on the VITA/TCE Programs. VSC #6 – Treat all taxpayers in a professional, courteous, and respectful manner. Failure to comply with these standards could result in, but is not limited to, the following: ŁYour removal from all VITA/TCE Programs; ŁInclusion in the IRS Volunteer Registry to bar future VITA/TCE activity inde˜nitely; ŁDeactivation of your sponsoring partner™s site VITA/TCE EFIN (electronic ˜ling ID number); ŁRemoval of all IRS products, supplies, loaned equipment, and taxpayer information from your site;ŁTermination of your sponsoring organization™s partnership with the IRS; ŁTermination of grant funds from the IRS to your sponsoring partner; and ŁReferral of your conduct for potential TIGTA and criminal investigations. TaxSlayer ® is a copyrighted software program owned by Rhodes Computer Services. All screen shots that appear throughout the of˜cial Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) training materials are used with the permission of Rhodes Computer Services. Con˜dentiality Statement:All tax information you receive from taxpayers in your volunteer capacity is strictly con˜dential and should not, under any circumstances, be disclosed to unauthorized individuals.
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iTable of Contents Part 1: Getting StartedImportant Changes for 2021. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Course Introduction ..1-1Temporary Provisions . 2-1Filing Basics ..3-1Part 2: Determining Filing Status and ExemptionsFiling Status ..4-1Personal Exemptions 5-1Dependents ..6-1Unique Filing Situations ..7-1Part 3: Determining Taxable Income Income ΠWages, Interest, Etc. ..8-1Income ΠBusiness 9-1Income ΠCapital Gain or Loss ..10-1Income ΠRetirement Income 11-1 Income ΠSchedules K-1 and Rental 12-1Income ΠUnemployment Compensation 13-1 ..14-1Income ΠOther Income .15-1Military Income .16-1Part 4: Determining Adjusted Gross Income (AGI) Adjustments to Income ..17-1Military Adjustments to Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18-1
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iiPart 5: Computing the Tax and Credits Standard Deduction and Tax Computation ..19-1 Itemized Deductions .20-1 Credit for Child and Dependent Care Expenses 21-1 Education Credits 22-1 Foreign Tax Credit ..23-1 Child Tax Credit & Credit for Other Dependents 24-1 Miscellaneous Credits ..25-1 Premium Tax Credit .26-1Part 6: Computing Other Taxes and Total Tax Other Taxes .27-1Part 7: Applying Refundable Credits and Computing Payments/Refund Payments and Miscellaneous Refundable Credits ..28-1 Earned Income Credit (EIC) .29-1 Refund and Amount of Tax Owed 30-1Part 8: Completing and Filing the Return Completing the Return ..31-1 Military Finishing and Filing the Return .32-1Part 9: Amending and Filing Returns Amended and Prior Year Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33-1Appendix Appendix: Premium Tax Credit Exercises A-1Index I-1
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ivImportant Changes for 2021Due Date of Return in Washington, D.C. Taxpayers in Maine and Massachusetts will have until April 19, 2022 because of the Patriots™ Day holiday in those states. Tax Form Changes Ł Form 1040, U.S. Individual Income Tax Return, includes a new question and checkbox added beneath line 27a: fiCheck here if you had not reached the age of 19 by December 31, 2021, and satisfy all other Ł Form 2441, Child and Dependent Care Expenses, contains two new checkboxes. Persons Filing Separately.fl If you meet these requirements, check this box. Checkbox B: For 2021, your credit for child and dependent care expenses is refundable if you, or one-half of 2021. If you meet these requirements, check this box.Ł Schedule 1 (Form 1040), Additional Income and Adjustments to Income, includes additional lines 8a other adjustments.Ł Schedule 2 (Form 1040), Additional Taxes, has several changes. Former lines 5 and 8 are revised so that, to the extent possible, each additional tax has a separate line and entry space, rather than a checkbox. New lines were added to minimize write-ins. Line 19 was added for additional tax from Schedule 8812. Ł Schedule 3 (Form 1040), Additional Credits and Payments, includes additional lines to replace checkboxes and space for write-in credits. New line 13g added for the refundable portion of the child and dependent care credit expenses from Form 2441, line 10. Line 13b was revised by adding text family leave credits from Form(s) 7202 for leave taken after March 31, 2021.Ł Schedule EIC, Earned Income Credit, added a checkbox for taxpayers to self-certify that they qualify for Ł Form 8379, Injured Spouse Allocation, was revised to remove the line for exemptions and to create separate lines for nonrefundable and refundable credits.Ł Schedule 8812, Credits for Qualifying Children and Other Dependents, will now be used as a single source, replacing Publication 972, Child Tax Credit and the child tax credit worksheet in the Form 1040 Instructions. Schedule 8812 will be used to claim the Child Tax Credit (CTC), Credit for Other Dependents, Additional Child Tax Credit, and to reconcile advance payments of the CTC.
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vi2021 ChangesŁ Recovery Rebate Credit: The Third Economic Impact Payment was authorized by the American Rescue Plan Act of 2021 as an advance payment of the 2021 Recovery Rebate Credit. Eligible per qualifying dependent. For details on who is eligible to claim this credit, see the Payments and Miscellaneous Refundable Credits lesson in this publication.Ł Child and Dependent Care Credit: The new law increases the amount of the credit and eligible makes it refundable. See the Temporary Provisions lesson for details. Ł Earned Income Tax Credit: For 2021 only, more taxpayers without qualifying children and couples can qualify for the Earned Income Tax Credit (EITC). That™s because the maximum credit is nearly tripled for Another change is available to both taxpayers without qualifying children and families with qualifying was higher than their 2021 income. In some instances, this option will give them a larger credit. See the Temporary Provisions lesson for details on these changes. Ł Changes expanding the EITC for 2021 and future years include:Ł Singles and couples who have Social Security numbers can claim the credit, even if their children don™t have SSNs. In this instance, they would get the smaller credit available to taxpayers without Ł More taxpayers who also have investment income can get the credit. Starting in 2021, the limit on Ł return, had a qualifying child who lived with them for more than half of 2021 and either: lived apart from their spouse for the last 6 months of 2021, or are legally separated according to state law under a written separation agreement or a decree of separate maintenance and didn™t live in the same household as their spouse at the end of 2021.Ł Child Tax Credit: For 2021, the new law increases the amount of the Child Tax Credit, makes it available for qualifying children age 17 (rather than 16), makes it fully refundable for eligible taxpayers, and makes it possible for families to receive half of it in advance during the last half of 2021. Moreover, families can get the credit, even if they have little or no income from a job, business or other source. 5 and under. For eligible taxpayers the credit is fully refundable for 2021. Previously, the refundable later. Ł Credit for Sick Leave and Credit for Family Leave for Certain Self-Employed Individuals: These credits for details.Ł Premium Tax Credit: Refer to the Premium Tax Credit lesson for the changes for 2021. Ł Self-Employment Expenses: There is a temporary exception to the 50% limit on the amount that businesses may deduct for food or beverages. The temporary exception allows a 100% deduction for food or beverages from restaurants. See details in the Temporary Provisions lesson.
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viiŁ Paycheck Protection Plan (PPP) loan forgiveness: Taxpayers may exclude from gross income any covered loan forgiveness. See the Temporary Provisions lesson. Any ITIN that is not used on a federal tax return for at least three consecutive tax years will expire on December 31 of the third consecutive tax year fi77,fl fi78,fl fi79,fl fi80,fl fi81,fl fi82,fl fi83,fl fi84,fl fi85,fl fi86,fl fi87fl or fi88fl have expired. In addition, ITINS with middle digits fi90,fl fi91,fl fi92,fl fi94,fl fi95,fl fi96,fl fi97,fl fi98,fl fi99fl if assigned before 2013, have expired. See for additional information.Personal Exemption Amount Certain Expenses of Elementary and Secondary School Teachers The amount of the deduction allowed that consists of expenses paid or incurred by an eligible educator in connection with books, supplies (other than nonathletic supplies for courses of instruction in health or physical education), computer equipment (including related software and services) and other equipment, equipment, disinfectant, and other supplies used for the prevention of the spread of coronavirus.Standard DeductionThe standard deduction for taxpayers who do not itemize deductions on Schedule A (Form 1040) has increased. The standard deduction amounts for 2021 are: Ł Ł Ł Taxpayers who are 65 and Older or are Blind For 2021, the additional standard deduction amounts for taxpayers who are 65 and older or blind are:Ł Ł Standard Mileage RateŁ 56 cents per mile for business miles drivenŁ 16 cents per mile driven for medical or moving purposesŁ 14 cents per mile driven in service of charitable organizations (no change)The standard mileage rate for business cannot be used to claim an itemized deduction for unreimbursed employee travel expenses during the suspension of miscellaneous itemized deductions that are subject to The moving expense deduction is not allowed through 2025 and the exclusion from income of moving expense reimbursements from an employer is also suspended. The only exception is for active military
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viiiservice members who move pursuant to a military order to a new permanent duty station.Retirement Savings Contribution Credit Earned Income Credit (EIC) For 2021, the maximum credit increased to:Ł Ł Ł Ł Earned Income Amount Increased income is more than their 2021 earned income. To be eligible for a full or partial credit, the taxpayer must Ł Ł Ł Ł Investment Income American opportunity credit for 2021 is gradually reduced (phased out) if taxpayers™ MAGI is between Tuition and fees deduction was repealed by the Taxpayer Certainty and Disaster Tax Relief Act of 2020 for tax years beginning after 2020. Income limitations for the lifetime learning credit were increased to help Lifetime learning credit Student loan interest deduction
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ixEligible Long-Term Care Premium Limits expenses on Schedule A (Form 1040), Itemized Deductions, or in calculating the self-employed health insurance deduction.Ł Ł Ł Ł Ł The limit on premiums is for each person. Foreign Earned Income Exclusion by a retirement plan at work, the deduction for contributions to a traditional IRA is reduced (phased out) if Ł widow(er) if both spouses are covered by a retirement plan,Ł Ł For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is 2021 Repayment Caps for APTC Income (as % of federal poverty line) Taxpayers using other Under 200%200%-299%300%-399%400% and aboveNo cap (full repayment)No cap (full repayment)Ł Ł The individual Shared Responsibility Payment (SRP) is reduced to zero. Taxpayers who do not have health insurance coverage during 2019 or later do not require an exemption to avoid the SRP. Ł Details about these and other updates can be found in the Premium Tax Credit lesson and in the
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