IRS Has Announced All These Changes to Your Taxes—Will You Be Affected?
iStock
One thing never changes from year to year: filing our taxes to the Internal Revenue Service (IRS). While the deadline may shift slightly on an annual basis depending on different circumstances, at some point, your return is due. The details, however, change constantly, and there are a number of shifting rules and regulations you need to make sure you have a handle on. In fact, several adjustments have already been announced ahead of the next filing season . Read on to discover the changes the IRS has made to your taxes recently, and whether you’ll be affected by them.
RELATED: IRS Issues New Alert on What You Must Do Before the Year Is Over .
iStock
But last year, the IRS decided to delay these new reporting requirements for those filing their 2022 returns. And now, the agency is pushing things back again.
RELATED: 6 Tax Return Secrets From Accountants .
iStock
The IRS is planning to push the implementation of the 2021 rule for the second year in a row. In a Nov. 21 press release , the agency announced another delay in the $600 reporting threshold for the upcoming tax season. This decision was made “following feedback from taxpayers,” according to the release.
“We spent many months gathering feedback from third party groups and others, and it became increasingly clear we need additional time to effectively implement the new reporting requirements,” IRS Commissioner Danny Werfel said in a statement. “Taking this phased-in approach is the right thing to do for the purposes of tax administration, and it prevents unnecessary confusion as we continue to look at changes to the Form 1040. It’s clear that an additional delay for tax year 2023 will avoid problems for taxpayers, tax professionals and others in this area.”
Due to this delay, taxpayers will not be required to report their third-party payments on their next tax returns, unless they received over $20,000 and had more than 200 transactions for this calendar year.
“As the IRS continues to work to implement the new law, the agency will treat 2023 as an additional transition year,” the agency noted.
RELATED: Taking These 2 Deductions Could Get You Audited by the IRS, Experts Warn.
iStock
The IRS just announced another tax change—although this one won’t affect how you file your 2023 taxes. According to GoBankingRates , the agency just increased their limits for gift and estate tax exemptions to the “highest exclusion amounts ever.” In other words, you can give more away without being taxed for it next year.
Right now, you can give an individuals up to $17,000 each in a single year without taxation. But in 2024, this rate will raise to $18,000, GoBankingRates reported. Married couples will also be able to give $36,000 to beneficiaries starting next year.
Alongside this, the IRS is increasing the lifetime estate and gift tax exemption to $13.61 million in 2024.
iStock / sasirin pamai
But there’s another more pressing change. Last month, the IRS announced changes to tax brackets for the 2023 tax season. Taking into account inflation, the new rates have pushed the upper limits 7 percent higher than in the 2022 tax year, Forbes reported.
As a result, you may owe a different amount in taxes, even if your income hasn’t changed from the last time you filed. With the change, the lowest tax bracket begins at 10 percent for individuals with $11,000 or less in taxable income, or $22,000 for married couples filing jointly. If you make between $11,001 and $44,725 as an individual, this rate goes up to 12 percent. Meanwhile, individuals making between $44,726 and $95,375 will fall into a 22 percent bracket, and those earning between $95,376 and $182,100 will fall into the 24 percent bracket.
Continuing on into the higher incomes, individuals making between $182,101 and $231,250 now have a rate of 32 percent, while people earning between $231,251 and $578,125 fall into a 35 percent rate. The highest bracket affects those who take in $578,126 or more in 2023, who will now pay 37 percent in taxes.
Best Life offers the most up-to-date financial information from top experts and the latest news and research, but our content is not meant to be a substitute for professional guidance. When it comes to the money you’re spending, saving, or investing, always consult your financial advisor directly.
IRS Announces Major Tax Filing Changes for Next Year—How You Can Benefit
brightstars/iStock
Filing your taxes may be the one thing you count on doing every year, but it might not always be the same process. Even when you haven’t had a major life change such as getting married or starting a new job, the Internal Revenue Service (IRS) still makes adjustments to the process that can affect how you submit your paperwork. In fact, those who are already getting everything in order ahead of the deadline might want to take note after the IRS announced a major set of tax filing changes for next year. Read on to see how you can benefit from the latest update.
RELATED: IRS Warns That Claiming These Credits Can Get You Audited and Fined .
iStock
While plenty of people choose to file their taxes online , the process can still involve a decent amount of physical paperwork for some who require extra forms or documentation . But if you’ve had to rely on the postal service to get everything in on time in the past, you can breathe a sigh of relief.
In a Nov. 7 press release, the IRS announced that it had reached its goal of implementing the Paperless Processing Initiative three months ahead of schedule. The program, which was announced in August, makes it possible for taxpayers to submit all correspondence and responses to notices using a Document Upload Tool on the agency’s website.
The new service provides another significant upgrade from the latest changes released last February, which made the nine most common correspondences available for digital reply, Yahoo Finance reports. The prior system relied entirely on using physical mail to conduct business.
Not only will the new system cut processing time in half, but the agency also says the program will help save over 200 million pieces of paper each year. And while the IRS estimates that 94 percent of individual taxpayers will no longer need to use the mail, those who choose to file through the post will still be able to if they choose to do so.
RELATED: IRS Issues New Alert on What You Must Do Before the Year Is Over .
iStock
If there’s any silver lining to paying your taxes, it’s getting a refund down the line. Now, those who are anxious to see some of their cash come back can get a better idea of when it’s coming thanks to the agency’s newly improved Where’s My Refund tool.
According to the IRS announcement, taxpayers will be able to use the online feature to check the precise status of their refund, as well as find out if they need to respond to an agency request for more information. Previously, the tool provided a generic message that didn’t offer any specific information about a person’s filing.
The tool has seen plenty of use in the past, with about 54 million taxpayers using it to generate 550 million hits in 2022, per the IRS. The agency says the detailed updates will likely reduce the number of phone calls made to the IRS for refund status inquiries.
RELATED: 4 Warnings About Using TurboTax, According to Experts .
iStock
When you’re looking for a quick answer to your questions while preparing your taxes, nothing beats the efficiency of a phone call. This year, the agency says it is continuing with improvements it’s made to its phone service to make the service even more accessible.
The agency says it plans to reach at least an 85 percent level of service once again during the 2024 filing season, carrying over improvements made to the system during last year’s filing brought about by hiring a stable of new representatives, per the press release. The IRS will also aim to have an average wait time of five minutes or less and offer a call-back option if the projected wait time is longer than 15 minutes.
RELATED: If You Already Did Your Taxes, You May Need to File an Amended Return, IRS Warns .
Studio Romantic / Shutterstock
Those who want some in-person help will also see some improvements. The agency says it is opening or has reopened 50 Taxpayer Assistance Centers nationwide and will be increasing the number of available hours for assistance by more than 8,500 hours. The complete list of locations and reopening dates can be found in the press release.
The IRS also says it will be rolling out more pop-up centers and aims to increase the number of taxpayers receiving free in-person preparation assistance by 50,000 returns. All told, some experts think the updates could help smooth out what can be a notoriously tricky and confusing process.
“I think these changes are good news,” Grant Dougherty , enrolled agent and founder of Dougherty Tax Solutions, told Yahoo Finance. “Anytime the taxpayer experience can be improved, I think it’s always a win for everyone involved. I do believe the [2024 filing season] will be a little smoother.”
