- Hola, hola, Ana Flores,
I am the Founder and CEO of #WeAllGrow Latina Network,
the online community for Latina creatives,
influencers and entrepreneurs.
I'm here today with my good friend now,
Lisa Greene-Lewis, TurboTax CPA and tax expert.
Lisa has over 20 years of experience in tax preparation
and her success is attributed to being able
to interpret tax laws,
help clients better understand them and save money.
She is here to help answer
some of our community members COVID related tax questions
and what the Coronavirus Relief means
for self-employed taxpayers, Bienvenida Lisa.
- Hola, hola #WeAllGrow community, thank you for having me.
- Well, we love having you here,
it's our sixth year of getting such important
and crucial advice from you
and this year we know it's especially important.
So (claps), ready? - Oh, thank you.
- let's get to it.
So question number one,
if I took distributions from my retirement due to COVID,
do I need to pay the early withdrawal penalty?
- So under the CARES Act, there's a provision
that allows you to waive that penalty
if you withdraw before you're 59 and a half,
so that penalty is waived.
In addition to that, if you do a COVID related distribution,
you're not required to recognize that income
on your taxes all in one year,
you can recognize it over three years.
So for example, if you took out $30,000
instead of recognizing that 30,000 in one year,
you would be able to recognize 10,000 per year,
lowering your tax on that.
- This question says, do I have to pay taxes
on my stimulus check payments?
- That is a big question we're seeing
and no, stimulus payments are not taxable.
And if you receive too much, you don't have to pay it back
but one thing to remember, if you received a partial payment
or didn't receive what you're eligible for,
you may be eligible for more stimulus
in the form of a Recovery Rebate Credit.
And then also a lot of people we're hearing,
I had a baby in 2020
and I'm eligible for some stimulus for my baby
but there's no way the IRS would know that
when they issued the stimulus payments.
So when you go to do your taxes,
you can claim a Recovery Rebate Credit
to get more of that stimulus money.
- That is really good to know.
So now that we're working from home, I love this question,
if I'm working from home,
can a part of my electric and rent bill be deducted?
- So if you're self-employed, good news,
a part of your utilities, rent
can be deducted as part of the Home Office Deduction
but only if you're self-employed.
We're hearing that question a lot,
if you're an employee and as of tax reform,
starting with 2018, employees can no longer deduct
and reimbursed expenses on their federal taxes,
some states will allow you to
so it's a state by state basis.
- How about this question?
Are there any specific tax related benefits due to COVID
I should be aware of if I'm self-employed?
- So under the Families First Coronavirus Relief Act,
there are some huge credits
that you may be able to get if you were sick
or taking care of a family member related to coronavirus.
And there are the qualified sick
and family leave tax credits, and these are huge credits,
if you were sick, if you were required to stay home
and quarantine or taking care of a family member
or even if your child's daycare was closed
as a result of COVID and you had to take care of them
and you had reduced hours.
And Intuit created a Tax Credit Estimator
that helps you figure out
how much of these credits you can get
and they can help lower your self-employment taxes.
And then also TurboTax has proactive guidance
on these credits when you go to do your taxes.
- Is there anything else that the community should know?
- Yes, I want the community to know if you have questions
on your taxes, you can connect live via a one-way video
to a TurboTax Live Self-Employed tax expert.
Get your questions answered along the way
or you can even hand your taxes over to the tax expert
from start to finish from the comfort of your home,
you don't need to leave and go anywhere
to have your taxes done.
- So I think that those are all the questions
that we have for today.
Thank you so much Lisa for being here
and providing all of us this important information.