3/16/2024 0 Comments Helpers vs moversBut feedback from taxpayers and payment processors confused by the new rules led the IRS to delay the new $600 reporting threshold requirement. This change was to take effect this tax season. However, new changes outlined in the ARP reduced the threshold for Form 1099-K reporting to $600 or more. Before the ARP, third-party platforms were required to provide Form 1099-Ks to taxpayers who received $20,000 or more through payment apps and made 200 or more transactions. The American Rescue Plan (ARP) of 2021 modified the requirements for reporting transactions involving payment apps, also known as third-party processors. On TaxSlayer's Website New 1099-K Reporting Threshold for Payment Apps Delayed If the taxpayer had received the same amount in 2022, they would have been taxed at a top rate of 22%. The income tax bracket changes mean that, as with higher standard deductions, taxpayers can expect to see a slightly smaller tax bill.įor example, a single taxpayer who has taxable income of $44,0 will be taxed at a marginal tax rate of 12%. Income Tax Brackets ExpandedĪlong with higher standard deduction amounts, the IRS has adjusted the income tax brackets from the 2022 tax year. Taxpayers who itemize their deductions can instead write off expenses such as mortgage interest, charitable contributions and state and local taxes. For the 2023 tax year, the additional standard deduction amounts are $1,850 for single filers or heads of household and $1,500 for married filers or qualifying widow(er)s. Taxpayers who are 65 and older, or are blind, are eligible for an additional standard deduction. Here are the standard deduction amounts for the 2023 tax returns that will be filed in 2024. These higher deduction amounts will result in lower taxes. The IRS estimates that 90% of tax filers claim the standard deduction, an amount set by the agency that’s linked to your filing status and other factors.Īmericans can expect to see larger standard deduction amounts when filing their 2023 tax forms. When filing your taxes, you can choose to claim the standard deduction or to itemize your deductions. Among them are higher standard deduction amounts, expanded income tax brackets and changes to business deductions. The agency expects more than 128 million returns to be filed before the official tax deadline on April 15, 2024.Īs you gather your financial documents, choose your preferred tax software and prepare to file, you may want to read up on some rule changes that could affect you. As of January 29, the IRS is accepting and processing tax returns for 2023. Ready or not, the 2024 tax filing season is here.
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