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As we approach the 2025 tax filing season, it’s crucial for individuals and businesses to stay informed about recent tax law changes that may impact their federal income tax returns. The Internal Revenue Service (IRS) regularly updates tax regulations to reflect economic conditions, legislative changes, and policy priorities. Here’s an overview of some key changes for the 2024 tax year:
To account for inflation, the IRS has adjusted federal income tax brackets and standard deduction amounts for 2024:
The IRS has increased contribution limits for various retirement accounts:
Encouraging retirement savings is a key focus of these changes, offering taxpayers greater opportunities to secure their financial future.
The Child Tax Credit (CTC) remains at $2,000 per qualifying child, with up to $1,600 refundable. However, thresholds for eligibility have been indexed for inflation.
The Earned Income Tax Credit (EITC) income limits and maximum credit amounts have also been adjusted:
For the 2024 tax year, the IRS has introduced new reporting rules for digital assets, such as cryptocurrency and NFTs:
Good record-keeping is essential for taxpayers engaging in these transactions.
The IRS will continue its phased implementation of the $600 reporting threshold for third-party payment platforms like Venmo, PayPal, and eBay.
The enhanced premium tax credits for health insurance purchased through the ACA marketplace have been extended for 2024. Taxpayers should verify their income eligibility to maximize these credits.
These updates are critical for businesses planning major equipment purchases.
Taxpayers can continue to benefit from incentives for adopting energy-efficient technologies:
As required by the PATH Act, the IRS will delay issuing refunds for returns claiming the Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC) until mid-February. This delay helps reduce identity theft and fraudulent claims.
The tax filing deadline for the 2024 tax year is April 15, 2025. Taxpayers who need more time can request an automatic six-month extension, pushing their filing deadline to October 15, 2025.
With these changes in mind, now is the perfect time to organize your financial records, review your tax situation, and consult a tax professional. Staying informed and proactive can help you avoid surprises, maximize deductions, and ensure a smoother filing process.
Visit IRS.gov or consult a licensed tax preparer for more detailed information about these updates.
This year’s changes reflect ongoing efforts to adapt the tax system to economic trends and taxpayer needs. By understanding and planning for these updates, you can file your 2024 tax return confidently and efficiently in 2025.
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