What the Second Stimulus Payment Means For You

Hardship, COVID, and Struggling Taxpayers

Hardship
and
Taxes

Depending on the degree of economic hardship that you are faced with, you may be eligible for adjustment to payments on back taxes, deferment of collection action, or leniency in regards to the default status of payment agreements (i.e. offer in compromise). Canceled debt from commercial lenders is often included as taxable income on your federal income taxes. At eFile.com, we will help you prepare and e-File your 2020 Tax Return. The eFile app will also find any tax credits and tax deductions you qualify to claim on your return. eFileIT now or by Tax Day, April 15, 2021.

Lean on this page if you are struggling with tax payments. 

Here are other life situations that affect your taxes: 

  • Job Loss: If you have been the victim of outsourcing or downsizing during these turbulent economic times, learn about job loss tax adjustments and get possible tax relief. For example, you can set up a health savings account (HSA), make tax-deductible contributions, and withdraw the money tax-free for qualified medical expenses (this is available to you even if you did not lose your job). 
  • Job Searching: Job search expenses have been eliminated as standard deductions increased. You might be able to ask an employer to reimburse certain expenses.
  • Bankruptcy: Bankruptcy and insolvency can be financially draining for many people. It is important to know the tax ramifications of bankruptcy or insolvency, such as reporting forgiven debt on your tax return if you receive Form 1099-C, Cancelation of Debt, from the creditor or lender that forgave the debt.
  • Divorce and Separation: A life-altering event such as separation or divorce has many tax implications. If you received alimony that is in a divorce or separation agreement finalized on December 31, 2018 or later, you can not deduct the alimony on your tax return, but it must be reported. The Tax Cuts and Jobs act eliminated the deduction of alimony from 2019-2025. The eFile app will help you report your alimony as the payer or payee and figure out if it can or can't be deducted based on the information you provide.
  • Marriage: If you got married in 2020, congratulations! Getting married is a big step in your life and will also impact your tax return. Take a look at some important marriage tax information and details when planning for or preparing your tax return now that you are a married person. The first thing you need to do when preparing your 2020 Tax Return is to select a filing status; you can only file as Married Filing Jointly or Married Filing Separately. Use this free STATucator to determine your status now.
  • Child Tax: Did you have a child in 2020? Congratulations on the new addition to your family! There are many important taxes related to children and dependents, such as the non-refundable Child and Dependent Care Tax Credit and tax deductions on college savings accounts. Determine if your child is eligible to be claimed as a dependent using the free DEPENDucator here on eFile.com.
  • Tax Withholding: Do you expect a tax refund next tax season? If so, why wait until then if you could get this refund money earlier? As of November 2020, the IRS issued over 165 million refunds for 2019 Tax Returns, and the average refund check was almost $2,600! That means that every month, most taxpayers pay an average of $217 too much in taxes. Are you one of them? You might withhold too much tax from your paycheck. Remember the time value of money: money now is worth more than the same amount of money in the future. Learn how to adjust your paycheck withholding on your Form W-4.
  • Tax-Free Income: Are you sure that you have considered all your tax-free income options? Learn about sources of income that the IRS cannot tax, such as child support and life insurance benefits.
  • Estimate Your Taxes: An essential component of tax planning is using a tax calculators to assess your tax credit, deduction eligibility plus to estimate your taxes before it is time to file your tax return. Click the link below to start estimating your 2020 Taxes now. To get a complete idea of your taxes, complete and e-File your 2020 Tax Return on eFile.com.

Plan to Save: Start the Free 2020 Tax Calculator

Additional Saving-Related Resources

Save money on your taxes each year.

Learn to save money on simple, everyday expenses.

Find ways to claim deductions or credits as a student.

Claim your home-related expenses on your taxes.

Information on COVID-19 and taxes.

Find ways to pay taxes here.

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