With Tax Day closing in, taxpayers should be aware of several changes that affect returns for the 2022 tax year which could lead to smaller refunds for a number of filers, writes Tom Herman for The Wall Street Journal.
Other changes could result in people who were expecting a refund ending up owing money for last year, depending on their situations and how they handled their withholdings.
There are also changes that will benefit the majority of taxpayers. The basic standard deduction amounts are higher for 2022.
Usually, the amount is $12,950 for singles or married individuals who are filing separately, $25,900 for joint filers or a surviving spouse who qualifies, and $19,400 for the head of a household. Additional amounts exist for people 65 or older, for blindness, and for several other factors.
Another important thing to note is that this year, the filing deadline is April 18 because April 15 falls on a Saturday, and April 17 is the Emancipation Day holiday in Washington, D.C. This gives most taxpayers with an extra few days to file their returns, no matter where they live.
However there are some exceptions. For example, later deadlines have been approved for millions of people in places that were designated as federal disaster areas.
“Disaster extensions – technically postponements – are something people get, even without asking,” said Eric Smith, an IRS spokesman.
Also some tax breaks have not been renewed, especially those related to the pandemic. The child credit tax, for example, has been significantly less generous for the last year. The credit amount is $2,000 for each qualifying child under 17.
Additionally, taxpayers who claim the standard deduction for 2022 cannot deduct any charitable donations they made last year.
Read about more tax changes in The Wall Street Journal.
Open House: Creative Capital Wealth Management Group – RSVP Today
The first quarter of a new year offers an opportunity to evaluate how world events, politics and trends might influence and shape economic developments across the Philadelphia region and the United States.
With inflation here to stay and whispers of a global recession looming, now is the time to arm yourself with the information you need to ensure a successful 2023 for you and your business.
At 4:00 PM on the March 22, 2023, Fred Hubler, founder and Chief Wealth Strategist at Creative Capital Wealth Management Group and Greg Care, partner in the Limerick office of Maillie LLP, will share their perspective on global, national, state, and local economic trends and answer your questions about how IRS changes made in 2022 might impact your tax return in 2023.
Attendance is limited to 25 readers of the weekly Wiser Wealth column of VISTA Today.
Reserve a ticket on EventBrite today