@Anonymous wrote:
Hey everyone, I think I figured out why if you choose to spread out the payments some of us are getting a bigger refund in 2020. While the taxable income is spread out over 3 years, the taxed amount is not. So your taxable income goes down for 2020, but your taxes paid do not, as they do not spread over the 3 years. This is great for 2020, but keep in mind this means your other two years likely won’t have taxes applied to the remainder of taxable income. Make sure to account for this! I recommend doing extra tax withholding for 2021 and 2022, if you’re opting to do the 3 year spread.
Correct - any tax withholding is apposed to the tax year in which it was withheld. That is part of the intent of the CARES act - give you 3 years to pay the tax and get a (partial) refund of taxes already paid.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
