OPENING DAY 2023

Today officially the Nation's Tax Season Opens. The IRS is now accepting completed returns via E-filing. And we at AM Income Tax are ready to assist you.

Hopefully you followed our recommendation from our previous blog and acquired a Tax Checklist to assist with the gathering of documents you will need to prepare your 2022 tax return. If you are working with a Tax Professional, you most likely received one directly from them. If you did not receive one or could not find a checklist, please email us and we will send you a copy right away.

We also have a general checklist available under our Checklist tab on our website.

Wondering what changes come with this Tax Season Opening Day. Well, most COVID-related enhancements from tax years 2020 and 2021 have expired for 2022, and several tax breaks from last year no longer apply. Not to mention, we’ve seen a significant jump in inflation this year, which led to additional tax adjustments. Here are a few of the key changes we feel are important to be aware of.

• Child Tax Credit increase from last year has expired -The Child Tax Credit (CTC) saw some enhancements last year, including half the credit amount paid to parents in advance monthly payments and an increase to the credit amount itself. These changes were temporary and have not been extended through tax year 2022.

• Child and Dependent Care Credit-This credit is no longer refundable in 2022, and the maximum credit percentage dropped to 35 percent (down from 50 percent last year). You can claim up to $3,000 in expenses for one child under 13 and up to $6,000 for two or more children under 13.

• Earned Income Credit-The Earned Income Tax Credit (EITC) saw several critical changes in 2021 that no longer apply in 2022. The amount you receive depends on your income level, filing status, and the number of children you have. Working childless adults can still qualify for this credit, but the age requirement and credit amounts have changed.

• Recovery Rebate Credit-There were no additional stimulus checks for 2022, meaning the Recovery Rebate Credit will no longer be available this tax year.

• Charitable Contribution deduction for non-itemizers from last year was not extended.

• Standard deduction increase-The IRS also increased the standard deduction amount for 2022. The standard deduction is an automatic deduction all filers can take (unless you choose to take itemized deductions). Here are the new 2022 standard deduction amounts:

- Married filing jointly: $25,900 ($800 increase)

- Single and married filing separately: $12,950 ($400 increase)

- Head-of-household filers: $19,400 ($600 increase)

Make sure to review this year’s tax changes to avoid missing or taking improper deductions or credits when filing your tax return this season.

Remember as you have heard your friendly neighborhood Tax Man say before, you do not have to take this tax journey alone. There are plenty of amazing tax professionals available, ready and willing to assist you. With even the simplest questions.

Feel free to reach to us here at AM Income Tax, we be glad to join you on your journey.

Welcome to a New Season -Tax Season!

Below you will find Key Filing Season Dates you should keep in mind for this year’s Tax Season:

• January 23: IRS begins 2023 tax season and starts accepting and processing individual 2022 tax returns.

• January 27: Earned Income Tax Credit Awareness Day to raise awareness of valuable tax credits available to many people – including the option to use prior-year income to qualify.

• February 28: EITC refunds for many available. The IRS cannot issue a refund that includes the Earned Income Tax Credit or Additional Child Tax Credit (ACTC) before mid-February.

• April 18: National due date to file a 2022 tax return or request an extension and pay tax owed due to the Emancipation Day holiday in Washington, D.C.

• May 15: California Storm Victims tax relief extended due date to file a 2022 tax return or request an extension and pay tax owed.

• October 16: Due date to file for those requesting an extension on their 2022 tax returns.