Income tax brackets and standard deductions have risen with inflation! This is good news as it means more of your income could fall into lower tax brackets, and the standard deduction has increased, potentially simplifying your filing.

The Inflation Reduction Act of 2022 significantly expanded tax credits for home improvements that make your home more eco-friendly!  The existing Residential Energy Credit has been revamped and renamed the Energy Efficient Home Improvement Credit. This credit now covers 30% of qualifying expenses, up to $1,200 per year. Insulation, door and window upgrades, air conditioners, heat pumps, and even a home energy audit may all be eligible!  Visit Energy Star for more information about eligibility, here: 

https://www.energystar.gov/about/federal_tax_credits/non_business_energy_property_tax_credits

Claim up to a $7,500 credit on a new electric vehicle, or up to $4,000 on a used one. This credit cannot reduce your income tax liability below zero, and any credit not used in the year of purchase will be lost. 

Claim 30% of eligible solar costs as a tax credit. This credit cannot reduce your income tax liability below zero; however, the unused credit amount will roll forward to future tax years. 

If you were impacted by Hurricane Idalia in Florida, Georgia, or South Carolina, you may be eligible for a deduction.  Claim unreimbursed losses you suffered to your home, belongings, or car on your 2022 or 2023 tax return. This includes damage from wind, flooding, debris, and power outages. The deduction is limited to your losses reduced by 10% of your income, which is then included in your itemized deductions (unless you use the standard deduction).

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New legislation may be coming soon: click here for the latest information.

The IRS has delayed the $600 reporting threshold for third-party platforms like Venmo and PayPal until 2025. This means your 2023 income from those platforms won't be automatically reported unless you exceed the existing $20,000 or 200 transaction threshold. However, you should still track your income for accurate tax reporting.

The CTA came into effect on January 1st, 2024, requiring transparency regarding the beneficial owners of certain entities. By January 1, 2025, domestic reporting companies (corporations, LLCs, etc.) formed before January 1st, 2024, must file a Beneficial Ownership Information (BOI) report with FinCEN. The report must disclose individual owners with significant control or ownership (25%+). New entities need to report within 90 days of formation. Change in ownership must be reported within 30 days. Penalties for non-compliance can be hefty ($500 per day), so ensure you understand your reporting obligations and deadlines. Full details can be found here: 

https://www.fincen.gov/boi

The standard mileage rate for business use of personal vehicles increased to $0.65½ per mile for 2023. Detailed mileage logs are not required for filing your return, but they may be needed in case of audit.  We have a checklist to help you collate your vehicle expenses.  Don't forget to take your mileage reading at the start of the year!  There are various apps that can help you track your mileage during the year.