Category: Tax News

Get up to date on all tax news from the IRS. The IRS is constantly updating us with law changes and new rules. Sometimes, it’s too much to keep up with. We’ll decipher the confusing lingo while you focus on staying current  on what’s really important.

If you have more questions about staying up to date with the IRS, leave a comment. Our tax team is ready to help!

Archive for the ‘Tax News’ Category

Updates on Student Debt Forgiveness: February 2024

Posted by admin on February 22, 2024
Last modified: February 22, 2024

The Biden Administration is Forgiving $1.2 billion in Student Debt Forgiveness for 153,000 Borrowers. 

On the 19th of January 2024, a significant announcement was made regarding an extra $4.9 billion allocated for student debt forgiveness and relief. This relief is specifically for 73,600 individuals, including teachers, social workers, firefighters, and nurses, who are eligible for the Public Service Loan Forgiveness program.

In a recent announcement, the administration led by President Biden revealed plans to forgive $1.2 billion in student debt for 153,000 borrowers. Individuals whose loans are set to be forgiven can expect to receive a personal email notification from the President himself within the day, as per the Department of Education.

In response to the Supreme Court’s ruling against the Biden administration’s proposal for widespread student loan forgiveness, the White House has introduced a new initiative to tackle the nation’s massive $1.77 trillion student debt burden. This debt relief program aims to support millions of borrowers by allowing them to eliminate up to $20,000 each in student debt.

In its most recent announcement, the Biden administration confirmed that they have given the green light for loan forgiveness to almost 3.9 million borrowers. Among them are individuals who have been diligently paying off their debts over the span of many years. Specifically, the latest batch of debt relief, which benefits 153,000 borrowers, is allocated to those participating in the Saving on a Valuable Education (SAVE) repayment program and have completed a minimum of a decade’s worth of payments.

student debt forgiveness

Who Qualifies for February 2024 Student Debt Forgiveness?

According to a recent Biden administration announcement, 153,000 borrowers under the SAVE program have been deemed eligible for certain benefits. As confirmed by the Education Department, these individuals have fulfilled the criteria of being part of repayment schemes for a minimum of a decade and having initially borrowed $12,000 or fewer for their college education.

Upon surpassing the borrowing threshold of $12,000, the department clarified that each subsequent $1,000 loaned entitles the borrower to forgiveness after another year of timely payments.

What Do You Need To Do?

As per the Education Department, individuals who qualify for loan forgiveness will soon receive an email notification from the President. No additional steps are required from recipients, as loan servicers will handle the forgiveness process promptly. Following the official statement, borrowers can expect to witness their loans being forgiven directly in their accounts within the next few days.

What Is The SAVE Student Debt Forgiveness Plan?

Introducing a new initiative called the EASE program, a modern income-driven repayment solution launched under the guidance of the current administration. EASE aims to alleviate financial strain by adjusting a borrower’s monthly payments based on their income, offering relief from excessive debt accumulation. This innovative program addresses issues that existed in previous IDR programs, preventing interest from escalating on borrowers’ debts.

Participants in the SAVE program can qualify for loan forgiveness after either 20 years or 25 years of making repayments. However, the White House has introduced a more expedited 10-year forgiveness plan specifically for individuals with lower loan balances.

How Many People Are Enrolled in SAVE Student Debt Forgiveness Plan?

As of Wednesday, the Education Department reported that 7.5 million individuals are registered in SAVE, with approximately 4.3 million not making monthly payments.

The 2024 E-File is Now Open. File Early with our Free Dedicated Tax Professional

Posted by admin on February 1, 2024
Last modified: February 1, 2024

The commencement of the 2024 tax filing season was marked by the Internal Revenue Service (IRS) on January 29, as they began accepting and processing the 2024 Efile for 2023 tax returns. It is a well-known fact that many taxpayers choose to postpone filing their taxes until the eleventh hour. Nevertheless, it begs the question: why delay such an important task?

When it comes to improving your financial situation, few things make as much of an impact as your tax refund. Last year, the IRS reported that around 65% of tax filers received a refund, an average amount exceeding $3,000. To ensure you receive your refund promptly, filing your tax return as soon as possible is advisable. Take advantage of PriorTax’s early opening to Efile both your current and past year taxes, maximizing your potential refund.

Are you looking for some motivation to Efile your taxes early? Be sure to do it before the last minute of the April 15, 2024, tax deadline. Instead, please take advantage of these four compelling reasons to start working on your taxes today and electronically submit your 2023 tax return with the assistance of our experienced tax expert, all at no cost to you.

2024 efile
2024 efile

1. Begin Your 2024 Efile for 2023 Tax Refund Today

Filing your taxes early and getting your refund sooner can be a smart financial move, especially considering the impact that last year’s events and the current year can have on your finances.

According to the Internal Revenue Service (IRS), taxpayers who file their taxes electronically and opt for direct deposit can expect to receive their tax refunds within 21 days or less, provided there are no complications with their tax return. Additionally, the potential for larger refunds may arise due to the various tax deductions and credits associated with moves made during the year.

2. Filing online for 2024 EFile is good, but with our Dedicated Tax Professional is Better

Achieving a seamless and precise tax filing experience with PriorTax E-File has always been challenging. By conveniently assembling your tax documents, you can gain access to an interactive platform where you will be prompted to provide essential information about yourself, ensuring that you receive the highest possible tax refund. With PriorTax diligently scouring through an extensive range of nearly 400 tax deductions and credits, you can rest assured knowing that you will receive every dollar you rightfully deserve, thanks to the accuracy of your answers.

Instead of going elsewhere to handle your taxes, there is no need when you have the opportunity to receive comprehensive guidance or have your taxes completed by our dedicated tax professional, all free of charge.

3. PriorTax Dedicated Tax Professional Will Do your Taxes from Start to Finish

When it comes to handling your taxes, there is an option to seek assistance from a knowledgeable tax expert. By connecting with a PriorTax free tax expert, your 2024 tax filing process can be efficiently completed within a short timeframe. Whether it be a full day or even as quick as 30 minutes, your taxes will be taken care of from beginning to end.

4. It’s Time to Find your Dedicated Tax Professional

Even if you find yourself in debt to the IRS, there is a compelling incentive to prioritize the early filing of your tax return. By submitting your return sooner rather than later, you are granted the luxury of delaying payment of any outstanding taxes until the mid-April filing deadline.

By taking the proactive step of starting your tax preparations ahead of time, you will have ample opportunity to strategize on how best to fulfill your financial obligations or explore alternative solutions if you owe a balance. Additionally, an appealing option to consider is contributing towards your Individual Retirement Account (IRA) for the year 2023 before the tax deadline on April 15, 2024.

When Are 2024 Business Tax Filing Due?

Posted by admin on January 25, 2024
Last modified: January 25, 2024

As you embark on your financial journey in 2024, staying vigilant and informed about various deadlines and responsibilities, such as tax filing and maximizing tax deductions, is crucial when business tax filing.

  • Jan. 16, 2024.: Q4 2023 Estimated Tax Payments Due
  • Mar. 15, 2024.: S Corp. and Partnership tax returns due for the tax year 2023
  • Apr. 15, 2024.: Last day for making 2023 contributions to IRAs and HSAs
  • Apr. 15, 2024.: Sole proprietor and C Corp. tax returns due. Q1 2024 estimated taxes are due.
  • June. 17, 2024.: Q2 2024 estimated taxes due
  • July. 31, 2024.: Tax Form 5500 – 401(k) Retirement Plan Filing deadline
  • Sept. 16, 2024.: Extended calendar-year for S-Corp. and Partnership and  tax returns due for 2023. Q3 2024 estimated tax payments due.
  • Oct. 15, 2024.: Extended sole proprietorship and C Corp. tax returns due. Tax Form 5500 – 401(k) Retirement Plan Extended Filing deadline
  • Dec. 16, 2023.: Q4 2024 estimated tax due for C Corp.
  • Jan. 15, 2025.: Q4 2024 estimated tax due for individuals tax payers
  • Updates and Changes for Business Tax Filing in 2024

As the landscape of tax credits and deductions evolves, it is crucial for both seasoned entrepreneurs and those embarking on a new business venture to stay informed. Familiarizing oneself with the latest updates is essential for accurately filing taxes and maximizing potential benefits before the 2024 business tax deadline.

To make informed decisions regarding your business tax filing in 2024, consult with our free and dedicated tax professionals who will guide you from start to finish for maximum tax refund.

2024 Business Tax Filing

What’s New on 2024 Business Tax Return Filing

New tax regulations are constantly being introduced and updated. As we prepare for the 2023 tax year, it’s important to take note of the key changes that will affect your return. These changes encompass a range of areas, including business meals, expanded credits for small employers’ retirement plans, tax incentives for purchasing clean vehicles, credit transferability, adjustments for inflation, the standard mileage rate for business driving, and the small employer’s health insurance credit.

Business Meals Tax Deduction

Starting in the year 2022, the full tax deductibility of business meals was implemented. However, in 2023, only half of the cost can be tax deducted.

More Tax Credits for Small Company Retirement Plans.

Innovation has taken hold in the realm of financial planning as a plan’s origins have broadened. Moreover, a fresh credit has emerged, focusing on specific employer contributions as an alternative to the traditional deduction.

Tax Credits for Buying New Cars.

The world of tax credits offers various benefits to those interested in purchasing plug-in electric and fuel-cell vehicles. These incentives include the new clean vehicle credit, previously owned clean vehicle credit, and the commercial clean vehicle credit. Each of these credits has its own unique set of eligibility rules and credit limits.

Tax Credit Transferability.

The opportunity to exchange green energy tax credits for cash is an enticing possibility. Take, for instance, the alternative fuel refueling property credit case. This tax credit, designed for installing charging stations, can be transformed into immediate cash through the sale to an interested buyer.

Adjustments for Inflation in 2024 Business Tax Return Filing

Every year, the IRS makes numerous adjustments to various tax items to accommodate inflation. These adjustments significantly impact individuals’ tax brackets, specifically affecting the amount pass-through entity owners must pay on their share of business income. Additionally, cost-of-living adjustments (COLAs) have an influence on several other aspects relevant to businesses. These include the standard mileage rate for business driving, the small employer’s health insurance credit, the gross receipts test, the Sec. 179 tax deductions (first-year expensing), the limitation on losses for non-corporate taxpayers, and the qualified business income (QBI) tax deduction.

Standard Mileage Rate from Driving for Business

Regarding business driving, the standard mileage rate plays a crucial role. It is worth noting that if one doesn’t deduct the actual expenses, the IRS-set rate for the year 2023 stands at 67¢ per mile.

Small Employer’s Health Insurance Tax credit.

In 2023, the adjusted amount for the Small employer’s health insurance credit, which is partly determined by wages, is now available.

Gross Receipts Test.

The eligibility assessment, commonly known as the gross receipts test, is pivotal in various aspects of a business’s financial operations. It determines the suitability of utilizing the cash method of accounting, the need for inventory accounting, and other specific purposes.

Limitation on Losses for Non-Corporate Taxpayers. 

The current year’s restriction on losses for non-corporate taxpayers has been raised, allowing excess losses to accumulate as part of a net operating loss for utilization in future years.

Qualified Business Income (QBI) Tax Deduction. 

With the start of 2023, a significant increase in the taxable income threshold could limit or prohibit the Qualified Business Income (QBI) deduction.

Sec. 179 Tax Deductions (first-year expenses).

The option of immediately deducting the cost of machinery, equipment, and other eligible property placed in service before the end of 2023 instead of gradually depreciating it is referred to as the Sec. 179 deduction or first-year expense. This tax deduction allows businesses to tax deduct up to the 2023 limit of $1,160,000.

2024 Tax Filing Will Open on January 29

Posted by admin on January 11, 2024
Last modified: January 9, 2024

In a recent announcement, the IRS has declared that the 2023 tax season will commence on Monday, January 29, 2024. Get ahead of the game and e-file your taxes now with PriorTax. By 2024 tax filing early, you can ensure you’ll be among the first to receive your tax refund.

If you are in need of assistance with your taxes, whether you prefer to tackle them independently, seek support throughout the process, or entrust them entirely to a tax specialist, the team at PriorTax is committed to providing expert guidance at no cost to you. Our dedicated Tax Professional aim to ensure you receive the maximum tax refund possible while offering comprehensive support from beginning to end. Individuals received an average tax refund exceeding $3,000 in the previous fiscal year.

2024 Tax Filing

2024 Tax Filing Deadline is April 15 for Most Taxpayers

On April 15, we celebrate Patriots Day, a great significance for our nation. It is a time when we honor and remember the brave patriots who fought for our freedom and independence.  In order to ensure a smooth and timely tax filing process, the we strongly advise the taxpayers to submit their tax returns as early as possible. Maintaining copies of previous tax returns for a minimum of three years is also important. For most taxpayers, the essential deadline to file their individual federal tax returns, settle any outstanding tax liabilities, or seek an extension is Monday, April 15, 2024.

April 15, 2024, marks the final day for individuals to submit their 2023 tax returns. However, residents of Maine and Massachusetts can breathe a sigh of relief as they have an extended deadline until April 17, 2024. This extension is granted in recognition of the significant holidays of Patriot’s Day and Emancipation Day. Furthermore, taxpayers residing in areas that have been declared as federally recognized disaster zones may be eligible for additional time to file their tax returns.

When tax filing your taxes electronically, e-file and direct deposit are the perfect combination for a speedy tax refund. The IRS estimates that approximately 90% of taxpayers will receive their tax refund within 21 days or less as long as there are no complications with their tax return.

Tax refunds are typically processed and issued by the IRS within 21 days, with EITC refunds becoming available starting February 27. However, the timeline for receiving a refund can be influenced by various factors once the IRS receives a tax return. It is important for taxpayers to refrain from depending on a specific refund date, particularly when it comes to significant expenses or bill payments.

Important 2024 Tax Filing Season Dates

Jan. 12: IRS Tax Filing opens

Jan. 16: Due date for 2023 fourth quarter estimated tax payments.

Jan. 26: Earned Income Tax Credit Awareness Day.

Jan. 29: The filing season starts for individual tax returns.

April 15: Due date of filing a tax return or requesting a tax filing extension.

April 17: Due date for Maine and Massachusetts.

Oct. 15: Due date for extension filers.

Finding your dedicated tax professional is the most effective way to track the status of any potentially delayed returns. In some instances, additional review may be necessary, resulting in a longer wait time.

Best Tips for 2024 Efile

Posted by admin on January 11, 2024
Last modified: January 9, 2024

Tax season has arrived once again, bringing with it the anticipation of receiving a sizable tax refund. Get ahead of the game and 2024 Efile your taxes right now to secure your spot for an Efile tax refund. While the IRS has yet to start accepting 2024 Efiled tax returns, PriorTax is here to assist you. Rest assured that we will securely store your completed taxes, send them to the IRS, and inform you when they open for e-file. To help you stay motivated, we have compiled five handy tips to give you a head start on getting your tax refund.

Last year, the average tax refund amounted to over $3,000, a welcome boost to many individuals’ finances. To assist you in preparing for this tax season, we are pleased to announce that PriorTax is now open and ready to receive your 2024 Efile Tax returns.

1. Prepare your Tax Documents to 2024 Efile in a Single Shot

When it’s time to file your taxes, gathering all your necessary documents, forms, and receipts in a single location is important. This will ensure that you don’t notice everything important. If you work for yourself, keeping an eye out for Form 1099-NEC and other income reporting forms is incredibly crucial.

Before you begin the filing process, it’sgathering all your necessary forms and receipts for deductible expenses is essential. To make this task more engaging, here are five valuable tips to give you a head start on maximizing your tax refund:

One helpful suggestion is to have a designated folder beside the area where your mail is delivered. By doing this, you will be able to keep W-2s, 1099s, and other important documents conveniently in one place. Additionally, it is always wise to keep a copy of your previous year’s tax return handy, as it may be necessary to refer to your adjusted gross income from the prior tax year when filing.

As a valued PriorTax customer, you can expect the seamless transfer of your adjusted gross income to your current tax filing. Our dedicated free Tax Professional team is here to guide you through the entire process, ensuring that you understand the necessary steps and efficiently organize your documents according to your unique circumstances.

2024 Efile

2. Remember What You Did Last Year

Recall the events and actions of the previous year. It is essential to ensure you have proper documentation for expenditures such as donations to charitable organizations and medical expenses when you commence the process of filing your taxes. These supplementary costs can result in a more substantial refund on your taxes.

3. Get your 2024 Efile Taxes Done

Getting your taxes done has never been easier than with PriorTax. No matter your circumstances or preferred filing method, PriorTax is here to assist you every step of the way. Whether you choose to tackle your taxes independently, receive guidance from a Tax Professional, or entrust them to a dedicated tax professional who can provide assistance either over the phone or in person, PriorTax ensures a seamless experience from start to finish.

4. Easy 2024 Tax EFiling with PriorTax

For individuals who have uncomplicated tax returns, with few credits and no need for additional forms or schedules, there is an opportunity to file federal and state taxes for maximum return using PriorTax with our Dedicated Tax Professional. Approximately 37% of taxpayers meet the criteria for eligibility.

Starting November 30, 2023, and continuing until March 31, 2024, individuals who possess a straightforward W2 or Form 1040 tax return, devoid of complex credits and without the need to include supplementary forms or schedules, will have the opportunity to obtain complimentary guidance from a tax professional as they navigate the tax process.

Intended for individuals who need to file tax returns and are eligible for different tax credits, PriorTax offers a user-friendly platform that simplifies the process. Whether you have to submit additional forms or schedules or not, our platform supports tax filing Form 1040. Our services cover uncomplicated returns which involve W-2 income, a small amount of interest, and dividend income that may or may not require the inclusion of Schedule B, the standard tax deduction, Earned Income Tax Credit,  Student Loan interest, and Child Tax Credit

5. Don’t Wait to 2024 EFile your Taxes

It is essential not to delay in tax filing your taxes as the average direct deposit tax refund exceeded $3,000 last year. It is crucial to note that choosing to 2024 Efile tax with direct deposit ensures the fastest receipt of your federal tax refund. According to the IRS, nine out of 10 taxpayers who 2024 Efile tax with direct deposit can expect to receive their federal tax refund within 21 days or even less.

No matter which steps you took in the previous year, PriorTaxTax is here to ensure they have a significant impact on your tax returns. Whether you prefer handling your taxes independently or entrusting PriorTax’s dedicated Tax Professionals with the task, rest assured that we will maximize your tax refund and ensure you with every dollar you are entitled to.

2024 Tax Changes May Generate Better Tax Refunds

Posted by admin on December 21, 2023
Last modified: December 21, 2023

In the upcoming year of 2024 tax filing, prepare for a pleasant surprise as significant tax modifications are set to take effect. Brace yourself for potential financial gain, as your paycheck has the potential to grow generously if you find yourself in a lower tax bracket.

In a recent declaration, the IRS unveiled various significant modifications to the tax code. These alterations can potentially affect the amount of tax deducted from your earnings, causing potential implications for specific individuals.

In anticipation of the upcoming year, 2024 tax filing promises adjustments to the federal income tax brackets as well as an increase in the standard deduction. This significant modification is a direct response to the persistently soaring inflation that has kept the prices at an elevated level throughout the entirety of the current year.

Every year, the IRS implements modifications to the tax code as a means to accommodate inflation and prevent the occurrence of “tax bracket creep.” This phenomenon has the potential to push individuals into higher tax brackets despite the impact inflation has on their wages.

In the year 2024, it is possible that your chances of moving up to a higher tax bracket due to increased income could be mitigated by incorporating inflation into the tax code. It could result in a drop to a lower tax bracket. If your annual income remains steady from 2023 to 2024, you could see a slight increase in your take-home pay each payday.

How Changes in 2024 Tax Code May Affect Your Tax Refund

If the IRS increases federal income tax brackets, individuals may find themselves in a lower tax bracket compared to the previous year, especially if their income remains unchanged.

In 2023, let’s say you earned $47,000 and found yourself in the 22% tax bracket. However, fast forward to 2024; if your income stays the same at $47,000, you’ll now find yourself in the 12% bracket. This change in tax bracket implies that next year, you’ll be liable for a reduced amount of federal tax and will see a smaller deduction from your paycheck.

In the upcoming year of 2024, if your income surpasses that of 2023, the extent to which your earnings have grown will dictate your position. There exists the possibility that even with the recent alterations, you might still find yourself fitting into a lower tax bracket.

Regardless of the situation, it is crucial to acknowledge that in the current state of lingering inflation, the impact of high prices is being felt in various ways. Thus, even if one transitions into a lower tax bracket and receives a slightly larger paycheck in the upcoming year, inflation has already eroded the value of expenses for basic necessities such as housing, transportation, and groceries.

2024 New Income Tax Brackets

When it comes to calculating the amount of taxes you owe in a specific tax year, your federal income tax bracket plays a significant role. This bracket determines the percentage of your income that will be taxed, excluding any standard or itemized deductions.

2024 tax filing

2024 New Standard Tax Deduction

In the upcoming year of 2024, a notable change has been made to the standard tax deduction for single filers. This adjustment has resulted in an increase of $750 compared to the previous year, bringing the tax deduction to a total of $14,600. Similarly, married individuals who file jointly will also experience a change in their standard deduction for the upcoming tax season.

2024 standard tax deduction

When it comes to tax returns, many individuals opt for the standard deduction, which effectively lowers their taxable income. This is especially true for those who earn wages from a single employer as a W-2 employee, as it often allows them to maximize their tax refund. However, itemizing deductions may be a more suitable approach for self-employed individuals or those with particular deductions in mind.

Other Beneficent 2024 Tax Filing Updated

Starting next year, there will be a range of tax adjustments that have the potential to boost your monthly income. Those who are beneficiaries of Social Security will be pleased to know that a 3.2% cost-of-living adjustment is slated to take place in 2024. Furthermore, due to the fortuitous timing of New Year’s Day falling on a holiday, recipients can anticipate their first augmented SSI payment right around the end of December.

To assist taxpayers in maximizing their deductions and credits, the IRS unveiled many updates and enhancements for the upcoming year of 2024. Among these revisions are:

  • An amplified cap for the Earned Income Tax Credit.
  • Refinements to the gift tax exclusion.
  • An expansion of the foreign earned income exclusion.

PriorTax free Dedicated Tax Professional will keep you up to date and walk you through navigating through 2024 tax filing for your maximum tax refund from start to finish.

2024 Tax Filing

Posted by admin on December 14, 2023
Last modified: December 14, 2023

In anticipation of the upcoming 2024 tax season, it is crucial to proactively prepare for any potential alterations that could affect your tax filing process. Whether you are a seasoned tax filer or venturing into the world of tax filing for the first time, navigating the tax season can be quite daunting.

To ensure a smooth and stress-free experience for the upcoming tax season in 2024, we have curated this indispensable handbook. It will equip you with the necessary information to accurately and efficiently file your tax returns for the year 2023.

2023 Tax Filing Important Dates and Deadlines 

Marking the beginning of the 2024 tax cycle, January 23, 2024, signifies the commencement of the official new tax season.

If the tax deadline is approaching and you cannot file your taxes, it is crucial to take the necessary steps to request an extension. One way to do this is by submitting IRS Form 4868, which is known as the Application for Automatic Extension of Time to File U.S. Individual Income Tax Return.

Please be aware that while this affords you extra time for tax filing purposes, it does not grant you an extension for tax payment. Should you be unable to settle your taxes in full by April 15, it is crucial to establish a payment plan with the IRS to prevent any detrimental consequences, including wage garnishment or the imposition of a tax lien.

2024 tax filing

2024 Tax Law Changes and Updates

The upcoming 2023 tax return brings numerous modifications and revisions that might affect your financial situation. Among these alterations, the elevated standard tax deduction is a prominent highlight, as it undergoes regular adjustments to accommodate inflation rates. Individuals filing as single will witness a noteworthy increase of $900, resulting in a new standard deduction of $13,850.

Married individuals filing jointly can take advantage of a higher standard tax deduction for the 2023 tax year. This year, their standard deduction will see a significant increase of $1,800 compared to the previous year, totaling a generous $27,700.

Apart from the rise in the standard deduction, a few other factors could potentially influence your tax situation.

2024 Child Tax Credit

In the upcoming tax year of 2023, the Child Tax Credit will revert to its pre-COVID regulations, just as it did in the previous year of 2022. Consequently, the tax credit will no longer be entirely refundable, only allowing for a refund of up to $1,600.

To be eligible for the full credit, individuals must have a modified adjusted gross income (MAGI) equal to or less than $200,000 ($400,000 or less for those who are married and filing jointly).

2024 Income Tax Credit

In 2024, individuals filing taxes for the 2023 tax year can avail of the Earned Income Tax Credit (EITC), which ranges from $600 to $7,430. The amount eligible for this credit is determined by income level, number of dependents, and tax filing status. If individuals do not have qualifying children, they must be between the ages of 25 and 65 to claim the EITC.

Number of Qualifying Children and Maximum Credit Amount:

  • $600 Max Tax Credit with 0 Children
  • $3,995 Max Tax Credit with 1 Child
  • $6,604 Max Tax Credit with 2 Children
  • $7,430 Max Tax Credit with 3+ Children

2024 Annual Gift Tax

In the upcoming year of 2023, individuals can take advantage of the 2024 annual gift tax deduction, allowing them to gift up to $17,000 ($34,000 if married) without incurring any taxes.

Health Savings Account (HSA) in 2024

In the upcoming tax year of 2023, individuals are granted the opportunity to contribute to their Health Savings Account (HAS) up to a maximum of $3,850. This equates to a $200 increase compared to the previous year. For those who have chosen family coverage, the contribution limit is set at $7,750.

The benefits of HSAs are threefold when it comes to taxes:

  1. Individuals can deduct 100% of their contributions from their tax burden.
  2. Any interest earned within the HSA remains tax-deferred unless it is used for non-medical expenses.
  3. When funds are withdrawn for eligible medical expenses, they are entirely tax-free.

2024 IRA & 410(k) Contributions Tax Deduction 

In the upcoming year of 2023, individuals who contribute to their 401(k) plans will be thrilled to learn that the annual deferral limits have experienced a significant jump, with up to $2,000 to increase from 2022.

The contribution limits for taxpayers aged 50 or above have been revised, allowing them to increase their investments in traditional and safe harbor 401(k) plans. Specifically, individuals in this age group can now contribute an extra $7,500, a notable increase from the previous year’s limit of $6,500.

In the realm of individual retirement accounts, specifically the traditional and Roth IRA, it is important to note the contribution limit for the year 2023. This limit stands at $6,500, although individuals who have reached the age of 50 or older are allowed to contribute up to $7,500. However, it is crucial to be aware of potential adjustments to your contribution amount in the case of a Roth IRA. These adjustments are dependent on your modified adjusted gross income (MAGI)

2024 Student Loan Interest Tax Deduction

With the resumption of student loan payments and the return of accruing interest, there is a potential opportunity to claim a deduction of up to $2,500 on your 2023 tax return. To be eligible for this deduction, individuals must have a MAGI of less than $90,000 (single, qualifying widow(er), or head of household) or $180,000 if they are married and filing jointly.

Step-by-Step Guide to Filing Taxes in 2024

Once you have assembled the essential paperwork, it is crucial to adhere to the comprehensive tax filing guide provided below. Following these step-by-step instructions will ensure a seamless and accurate procedure.

Opt for a tax preparation approach like utilizing tax preparation software or seeking advice from a tax professional. Should you opt for the traditional paper tax return, it is important to remember that the processing time may extend up to six months. E-filing is strongly recommended whenever feasible.

To ensure the accuracy and completeness of your tax return, it is important to input all relevant information into PriorTax. Remember to sign and date your return and attach any necessary tax documents, forms, and schedules if filing by mail. Remember, the deadline to submit your tax return is April 15.

When managing your taxes, don’t hesitate to contact the experienced Tax Professionals at PriorTax. PriorTax understands the importance of affordable tax preparation for individuals and small business owners, offering services tailored to your specific needs. Additionally, we are dedicated to assisting you in resolving any tax debt issues you may face. Take the first step towards financial peace of mind by connecting with your dedicated Tax Professional, free of charge.

1099-K for TPSO Reporting Delay For Tax Year 2023

Posted by admin on November 23, 2023
Last modified: November 23, 2023

IRS Announced 1099-K Form for TPSO Reporting Delay For Tax Year 2023

The IRS has announced a postponement of Form 1099-K reporting requirements for third-party platforms in 2023. Instead, the current threshold of $5,000 will be implemented in 2024 as a gradual transition period.

For the upcoming tax season, the IRS has pushed back its initial reporting threshold for third-party settlement organizations (TPSOs) to take effect. The American Rescue Plan 2021 requires that transactions over $600 in Tax Year 2023 not be reported on IRS Form 1099-K by TPSOs or the payee. This decision affects popular companies such as Venmo and PayPal.

The IRS has ruled that the existing 1099-K reporting threshold for the tax year 2023 will remain the same, being payments of more than $20,000 in total from over 200 individual transactions.

Here are the Details of the 1099-K Form Reporting Delay

To minimize taxpayer misconception and confusion, the IRS issued Notice 2023-74, announcing that the new $600 Form 1099-K reporting threshold for third-party settlement organizations has been postponed until calendar year 2023. The decision was based on an analysis of feedback from taxpayers, tax professionals, as well as payment processors.

To reduce potential confusion, the IRS has declared that 2023 is to be viewed as a transition year regarding the new law. The agency will only require reporting if a taxpayer receives more than $20,000 and they have engaged in more than 200 transactions during that year. This has been put into effect due to the estimated 44 million Forms 1099-K being sent out to unsuspecting taxpayers who may not owe any tax.

In order to ensure stakeholder certainty and help individual taxpayers comprehend the intricacies of the new provision, the IRS is proposing a phase-in for the $600 reporting threshold in 2024. This would involve setting a threshold of $5,000 for tax year 2024 as stipulated by the American Rescue Plan (ARP).

In response to the valuable input of those within the tax community, the IRS is mulling over potential updates to Form 1040 and its associated schedules for 2024. Making changes to this essential form – which serves over 150 million taxpayers annually – requires much consideration and analysis, hence why these changes are planned for 2024 to gain further feedback from stakeholders.

Beginning in 2022, the American Rescue Plan has mandated that any third-party settlement organizations (TPSOs), including digital payment apps and online marketplaces, must report payments of more than $600 for goods and services on a Form 1099-K. This form will be sent to taxpayers and the Internal Revenue Service (IRS) to assist them in correctly completing their tax returns. Prior to this regulation, only transactions that amounted to more than $20,000 through at least 200 sales per annum were required to submit such paperwork.


The IRS Temporarily Delayed the New 1099-K Requirement.

When it comes to personal transactions such as presents for a birthday or special occasion, sharing the cost of a car ride or dinner with someone, or paying another person for a household expense, there is no need to file any reports. These payments do not incur taxes and should not be recorded on Form 1099-K.

Though it may seem odd, many individuals who make casual sales of goods and services – like used clothes, furniture, and other household items – might receive a Form 1099-K in the mail, even if these sales produce no taxable income. In fact, it is not uncommon for those selling such goods to take a loss.

The IRS has determined to push back the date for the reporting requirements and set a threshold of $5,000 for 2024 in light of the difficulty in identifying these transactions. They are asking for input on the dollar amount as well as any other aspects on how to focus on taxable trades. In particular, they seek feedback concerning the chosen threshold of $5,000 for the 2024 tax year.

PriorTax understands the importance of properly managing the expansion of information reporting that is to take place due to the new thresholds set for Form 1099-K. In addition, it is vital that both taxpayers and our tax professionals have all the necessary resources to help them understand and comply with these changes. This increased reporting leads to a higher rate of tax compliance.

November 16. A New Extended 2023 California Tax Extension Deadline

Posted by admin on October 19, 2023
Last modified: October 23, 2023

Taxpayers in California have been offered an California Tax Extension of the 2023 tax deadline. Here’s what you need to be aware of concerning the extra time the Internal Revenue Service (IRS) gives.

This year, California was met with an unfortunate tragedy as unparalleled snowfall and widespread flooding wreaked havoc on the state. In response to this natural disaster, the Internal Revenue Service (IRS) granted residents affected by the storms an extension to their 2022 tax filing deadlines in 2023.

Are you concerned about the news but unsure what it means?

Don’t worry. PriorTax free Dedicated Tax Professionals are here to help break down which counties are involved and when key dates should be kept in mind and to give you advice on how to go about filing a claim due to this catastrophic event. And remember – we can be there for you when it’s time!

As of October 16, 2023, The IRS has officially extended federal tax deadlines for Californian taxpayers to November 16. This applies to all (55 Counties) but three counties in California – Lassen, Modoc, and Shasta – which were declared disaster areas by FEMA over the course of several months.

California’s Franchise Tax Board has granted an additional extension on filing and payment of state taxes for tax year 2022 to accommodate those affected by disaster areas. Those living in covered disaster areas have until November 16, 2023, to submit their returns. This allowance follows suit with federal tax deadline changes.

Those located in counties announced by the IRS on January 10, January 24, and March 17 as disaster areas are allowed the benefit of an extended deadline to submit their taxes. Unfortunately, those living and conducting business in Lassen, Modoc, and Shasta counties won’t have this reprieve.

california tax extension

California Tax Extension Deadline 2023

Generally, the timeline for paying your federal taxes remains fixed. But in the event of catastrophic occurrences, you are eligible for an extended payment period. As long as your address is one of those located in a declared disaster area, additional time is granted without having to request it formally.

Apart from requesting a California tax extension, you could be eligible to take advantage of a disaster loss deduction on your taxes should your property have been affected by the stormy weather. Further information on this subject can be found below on this page.

In California, those living in federally declared disaster areas included in one or more of three separate declarations have until November 16, 2023, to file and pay their taxes. This date serves as a deadline for taxpayers living under these conditions.

California Disaster Information

In times of stress, such as when suffering property damage from a major storm, filing for a tax extension can be quite beneficial. This extra time will allow you to focus on more pressing tasks, like filling out insurance reports or making necessary repairs.

Although it can be heartbreaking to suffer a loss due to the storms, there is hope: You can apply for a disaster-related tax deduction for either the 2022 or 2023 tax year as long as the federal government has designated your area as an official disaster zone.

For those who have experienced loss due to a disaster in 2022, it is wise to begin collecting and submitting the necessary documents before the 2023 California tax deadline on November 16. This could necessitate obtaining appraisals, filing insurance claims, and other proceedings for determining the worth of your property. Therefore, beginning this administrative work ahead may prove beneficial as it can take time for all these steps to be completed fully.

What are The New Extended Tax and Payment Deadlines for California Storm Victims?

Due to multiple FEMA declarations concerning severe storms, flash flooding, mudslides and landslides that took place over a certain period, tax filing and payment deadlines have been extended until November 16, 2023. All individuals and businesses in the affected area thus have additional time to submit their taxes originally due during this period.

2022 Individual and Business Returns:

Eligible taxpayers can now take advantage of extended deadlines for filing their 2022 returns and contributing to their IRAs and health savings accounts. Their returns, including business and personal income taxes, were originally due on March and April, but are now required by November 16, 2023. This allows for an eight-month extension of the original deadline.

Quarterly Estimated Tax Payment:

The 4th quarter estimated 2022 and 2023 income year payments have been postponed until November 16, 2023. This means individual taxpayers are exempt from making their fourth quarter payment on January 17, 2023. Instead, they can include this with their income return when filed by November 16.

Quarterly Payroll and Excise Tax Returns:

After assessing the current financial situation, I found that the due date for payroll and excise tax returns, which are usually due on May 1, July 31, and October 31, has been extended until November 16, 2023. Furthermore, no penalties will be imposed on payments made between January 8-23, 2023, as long as these deposits occur on or before the 23rd.

What Do I Need To Do to File on a New Extended Tax Extension Deadline?

Taxpayers in a disaster area do not need to contact the IRS for filing and penalty relief, as this is automatically extended. However, there may be instances where affected individuals receive late payment or filing charges with due dates that fall during a postponement period; in such cases, it would be advantageous to call up the number stated on the notice and seek a reduction of penalty.

If impacted, how can I claim a casualty and property loss on my taxes?

Those who experienced damage from a disaster but have not been previously insured or reimbursed can declare the losses on their tax return either for the year in which it occurred (2023) or even go back to the prior year’s return (2022). Additionally, any personal property losses that is not covered by insurance can be deducted, too.

When you are filing your taxes concerning the California disaster loss, clearly note the Disaster Designation- “California, severe winter storms, flooding, landslides, and mudslides” – at the top of the form. Writing it out in bold is a good way to ensure that all details will be taken into account.

Penalty, Consequences and Important Next Steps from Missing the Tax Extension Deadline

Posted by admin on September 21, 2023
Last modified: September 22, 2023

Do you need to catch up on the annual tax filing deadline? What are the penalty from missing the tax extension deadline, repercussions, and what should be done next? Tax Day is an expected event that occurs every year, generally on April 15. But even when you know it’s coming, making sure your income tax return is ready in time can be difficult.

Do you need more time to organize all of your income tax documents? Extensions can be the perfect tool to give you some extra days. In this article, we’ll explain the fundamentals so you can get everything sorted out for your return.

Penalty for Missing the Tax Deadline?

Failing to submit a tax return or extension by the specified deadline can result in the IRS imposing a failure-to-file penalty. This penalty is 5% of your total amount of unpaid taxes for every month (or partial month) that goes by without you filing. In extreme cases, this fee can reach as high as 25% of your total taxes owed.

Suppose you have an amount of $10,000 in taxes to pay. The IRS may impose a penalty of $500 per month should you fail to file your taxes on time.

Filing a late tax return without expecting to owe penalties may not incur a penalty from the IRS, but should you think that you might have to pay, consulting a tax professional is wise. In this situation, you will likely face interest and penalties as consequences of delayed filing.

tax extension deadline

Tax Extension Deadline for Filing 2022 Taxes

There are two key dates to consider when considering the tax extension deadline. April 18, 2023, is a date that all taxpayers should mark on their calendars – it’s both the original filing deadline as well as the deadline for submitting an extension request. By filing for an extension, you will have more time to complete your taxes, but any taxes owed still need to be paid by April 18.

The October 16, 2023, tax extension deadline is quickly approaching. But what would you do if you missed the April or October deadline? Can I get more time? To help make sure you’re well informed, contact your dedicated tax professional from PriorTax for free.

What will Happen Missing the Tax Extension Deadline?

Regarding punishment for not making the April tax filing and payment deadline, you may be subject to two different fees: the failure to file a penalty and the failure to pay the fee (in cases where money is owed). Fortunately, those who submitted an extension and followed through with their taxes by their extended deadline are exempt from the failure to file a penalty.

For those of you who let the October deadline come and go without filing, it will result in failure to file penalties that have taken effect as of the original filing date (generally October 15). This could also mean potential failure to pay penalties stretching back to April 15, typically the payment due date.

To help avoid accumulating additional fees or interest, filing a tax return as soon as the October 16, 2023 deadline passes is highly recommended. The sooner you submit it, the better to minimize any extra costs.

Getting Even More Time after the October Tax Extention Deadline?

The October 16, 2023, tax filing extension deadline is firm – no exceptions. So, for anyone who needs to file their taxes for the 2022 tax year, this is the final opportunity to do so without incurring failure to file interest and penalties Charges.

Do you need assistance paying your tax bill? The IRS offers a payment plan option, which allows you to break up the cost into smaller payments. Find your dedicted tax professional for free to learn more about on boarding on an installment agreement with the IRS and get the information you need to stay on top of your taxes.

Tax Installment Agreement

In the event that you are unable to pay your taxes all at once, there is a way to spread it out over time. An installment agreement with the IRS allows individuals to make payments on their tax debt in manageable increments. This type of plan also reduces the failure-to-pay penalty by half, though the IRS does require an administrative fee for establishing such an arrangement.

A successful installment agreement may be easily achieved through the IRS Online Payment Agreement tool, though some instances can require added proof of income and assets. When this is the case, the Internal Revenue Service will limit expenses to a level that is considered reasonable when determining how much can be afforded every month.

Request Your Prior Year Tax Refunds Today Before You Lose Them

Don’t let your tax refund slip away. Even though getting a refund after the due date is still possible, you want to make sure you get all the money.

You have a limited amount of time to request a refund from your tax return, as mandated by IRS regulations. Generally, it is three years from when your taxes are due; for instance, say you still need to file your 2022 return by April 18, 2023, then in 2026, you would no longer be eligible for any tax refunds. After this deadline has passed, it is considered that you have given up on claiming back what belongs to you, and instead, it goes to belonging to U.S. Treasury.

Even though you may not have a tax debt, the IRS still requires you to file a return. Missing documents from prior years can be obtained from your employer, bank, or other third-party sources such as an educational institution or loan provider. Get in touch with a dedicated tax professional from PriorTax for free to walk you through this process from start to finish.