Current Tax Events
The IRS encourages every taxpayer to stay informed about the latest tax events. Whether you are a filer or are planning to file your income tax return for the very first time, it is important to learn about what is happening. Although you can always visit the IRS website, we have created the ultimate post that takes a look at the current tax events that taxpayers need to know about in 2022.
Charitable Contribution Deduction Changes
Taxpayers who do not itemize their deductions might qualify for a deduction of up to $600. Married taxpayers who file joint returns can expect the same. As for other files, they can expect to claim a deduction for up to $300 for cash contributions made to qualifying organizations.
Advance Child Tax Credit Payments
Families who had received advanced payments will have to check the amount of child tax credit they can claim with the advance child tax credit payments which they had received in 2021 when filing their tax return. As for eligible families who did not receive a monthly advance payment in 2021, they can seek a lump-sum payment by claiming child tax credit with their federal income tax return. Although the credit had been a lifeline for many families during the pandemic, it is expected to discontinue after December 2021. The news has affected families across the country who depend on the payment for meeting rent and groceries.
Economic Impact Payment
Individuals who did not receive the third economic impact payment or did not qualify for it might be eligible for the recovery rebate credit. However, they must file a tax return to claim the credit even if they do not normally file one. To calculate the correct recovery credit amount, individuals will need to know the amount received in the form of third economic impact payment and other payments received.
The IRS Is Interested In Your Crypto Transactions
If you have made any crypto transactions, you will need to report them to the IRS. As the tax season approaches, the IRS is eyeing crypto investors. Form 1040 which is used by U.S. taxpayers for filing their annual income tax return has a virtual currency option on the first page which crypto investors will need to fill. This means that transactions involving Ethereum, bitcoin, dogecoin, or any other cryptocurrency must be reported. The transactions include compensations, rewards for crypto-mining, and free coins.
Home-Office Tax Deduction
With the Great Resignation in full swing, you might be able to claim a home-office tax deduction if you started your own business or became a full-time freelancer this year. It is one of the biggest deductions that you can benefit from. It is only offered to independent contractors, gig workers, and those who are self-employed.
Get Started With Bookkeeping
Bookkeeping is necessary for achieving success. Whether you are a business owner or a salaried person, you need to organize all your financial information. Therefore, you need the use our service for the best experience.