There are lots of changes for 2021 tax season.

Highlighted some of them hereunder.

CHILD TAX CREDIT

The $2,000-per-child credit rises to $3,000…$3,600 for children under age 6…and 17-year-olds qualify. The credit is fully refundable, and IRS is required to pay 50% of it in advance to qualifying families.

The higher credit begins to phase out at AGIs of

$75,000 for singles,

$112,500 for household heads and

$150,000 for joint filers.

The credit is reduced $50 for each $1,000 of AGI over the applicable threshold amounts. The phaseout applies to the $1,000 or $1,600 increased credit amount for 2021 and not to the $2,000 credit. Families who aren’t eligible for the $3,000 or $3,600 credit, but who have AGIs at or below $400,000 on joint returns or $200,000 on others, still get the $2,000 credit.

STIMULUS CHECKS

Millions of taxpayers got a third round of stimulus checks of $1,400 for singles

and household heads and $2,800 for joint filers, plus $1,400 more for each dependent.

The money isn’t taxable. It is an advance payment of a tax credit on the 2021 return.

CHARITY

The following easings on cash gifts to charity in 2020 also apply for 2021:

Nonitemizers can write off up to $300 of charitable cash contributions.

For 2021 only, the ceiling is $600 for married couples who file a joint return.

The 60%-of-AGI limit on cash contributions by individuals is suspended.

The taxable income limit on charitable gifts of cash by C corps is 25%.

TAX BREAKS

A batch of tax breaks that were set to expire after 2020 are extended.

Some were extended permanently, some through 2025 and others for one year.

Among the permanent breaks: The 7.5% adjusted-gross-income threshold

for deducting medical expenses on Schedule A. Lower excise taxes on wine, beer

and liquor.

The deduction for energy-efficient improvements to commercial buildings.

Included in breaks extended through 2025

MEALS & ENTERTAINMENT

Businesses can deduct 100% of business meals in 2021 and 2022.

Congress suspended the 50% haircut for two years to encourage restaurant dining.

This includes client meals as well as meals for employees on business travel.

DEPENDENT CARE AND FSA

There is relief for health and dependent-care flexible spending arrangements.

Employers may opt for FSAs to permit carryover of unused amounts from 2020

to 2021, and from 2021 to 2022, and to give a 12-month grace period for unused funds.

STANDARD DEDUCTIONS

Standard deductions for 2021 rise a bit. Married couples get $25,100

plus $1,350 for each spouse age 65 or older. Singles claim $12,550…$14,250

if 65 or up. Household heads get $18,800 plus $1,700 once they reach age 65.

Blind people receive $1,350 more ($1,700 if unmarried and not a surviving spouse).

GIFT TAX

The gift tax exclusion remains $15,000 per donee. You can give up to $15,000

($30,000 if your spouse agrees) to each child, grandkid or any other person in 2021

without having to file a gift tax return or tap your lifetime estate and gift tax exemption.

TAX BRACKETS

Marrieds: If taxable income is The tax is
Not more than $19,900 10% of taxable income
Over $19,900 but not more than $81,050 $1,990.00 + 12% of excess over $19,900
Over $81,050 but not more than $172,750 $9,328.00 + 22% of excess over $81,050
Over $172,750 but not more than $329,850 $29,502.00 + 24% of excess over $172,750
Over $329,850 but not more than $418,850 $67,206.00 + 32% of excess over $329,850
Over $418,850 but not more than $628,300 $95,686.00 + 35% of excess over $418,850
Over $628,300 $168,993.50 + 37% of excess over $628,300
Singles: If taxable income is The tax is
Not more than $9,950 10% of taxable income
Over $9,950 but not more than $40,525 $995.00 + 12% of excess over $9,950
Over $40,525 but not more than $86,375 $4,664.00 + 22% of excess over $40,525
Over $86,375 but not more than $164,925 $14,751.00 + 24% of excess over $86,375
Over $164,925 but not more than $209,425 $33,603.00 + 32% of excess over $164,925
Over $209,425 but not more than $523,600 $47,843.00 + 35% of excess over $209,425
Over $523,600 $157,804.25 + 37% of excess over $523,600
Household Heads: If taxable income is The tax is
Not more than $14,200 10% of taxable income
Over $14,200 but not more than $54,200 $1,420.00 +12% of excess over $14,200
Over $54,200 but not more than $86,350 $6,220.00 + 22% of excess over $54,200
Over $86,350 but not more than $164,900 $13,293.00 + 24% of excess over $86,350
Over $164,900 but not more than $209,400 $32,145.00 + 32% of excess over $164,900
Over $209,400 but not more than $523,600 $46,385.00 + 35% of excess over $209,400
Over $523,600 $156,355.00 + 37% of excess over $523,600