FEDERAL
There aren't any major tax law changes on the federal side this year. There are however, a couple of things to note.
1. When comparing tax year 2022 to 2023, there was a big adjustment to the federal income tax brackets. While the rates didn’t change, there was roughly a 7% increase in the brackets, which expanded the amount of taxable income you can have in each tier. This was mostly an adjustment brought about to help combat inflation.
2. Form 1099-K reporting changes are delayed again. The IRS in November announced a plan for changes in recording business payments made via apps such as PayPal or Venmo. Prior to the change, even a single payment of $600 would have triggered Form 1099-K, which reports business payments to the IRS.
Instead, the old limit of more than 200 transactions worth an aggregate above $20,000 is now in effect.
Keep in mind, all business income is taxable and must be reported; these changes only refer to who will be mandated to receive a 1099 by payment collection services.
3. If you purchased a vehicle in 2023 or made energy improvements to your home, you could qualify for tax breaks. The clean vehicle tax credit caps the break at $7,500, while eligible eco-friendly home improvements could be worth thousands more.
Questions? Contact us via our website or email, or you can ask Kenny at your next tax appointment. When in doubt, bring documents and expense totals with you to your tax appointment.
OKLAHOMA
1. Oklahoma still hates gamblers and people with property. Itemized deductions in OK cap at 17,000 in 2023 again. Amounts for charity and medical costs are the only ones allowed to exceed this cap.
2. Oklahoma is finally allowing refunds to be issued via check as long as they are over 10$. Finally an option other than the terrible debit card for people who do not want direct deposit.
3. The Parental Choice Tax Credit offers Oklahoma families a refundable tax credit of $5,000 to $7,500 for private school (and home school) tuition and fees. If you will pay, or expect to pay, for a child's private school this year, you can apply for the credit. Once there is more firm instruction on this program, I'll make a separate blog post on it exclusively.
This application process is not part of the tax return process. The application is separate and requires more data from your school than your tax preparer. https://www.parentalchoice.ok.gov/
Questions? Contact us via our website or email, or you can ask Kenny at your next tax appointment. When in doubt, bring documents and expense totals with you to your tax appointment.
コメント