Some of you may see a deposit in your bank account this week! Even though Social Security has not yet sent the letter to you, the deposit is valid! Congratulations! Have a wonderful week and see you soon! Tina and Denise (This message reprinted from PORAC) |
What’s New This Season - 2025
Happy New Year! 2024 was a fun-filled year with travel to Europe, James graduating high
school, and Joe transitioning out of the US Navy and returning home. There will
be more travel and fun in 2025!
Now, on to business matters…
We provide a secure link for easy upload through Dropbox for clients who send their documents via email or US mail. Contact us for details or to request a link.
Please take note of our new email address: tinataxpro@protonmail.com.
New Services!
We now provide Notary services, and we will travel to your site. Contact Tina if you need any documents notarized.
E-file 2025
The IRS will begin accepting and processing tax returns on January 27, 2025.
Key Tax Code Changes
2024 Tax Year – Final Tax Brackets
|
Income Bracket |
Single |
Married Filing
Joint |
|
10% |
<$11,600 |
<$23,200 |
|
12% |
>$11,600 |
>$23,200 |
|
22% |
$47,150 |
$94,300 |
|
24% |
$100,525 |
$201,050 |
|
32% |
$191,500 |
$383,900 |
|
35% |
$243,725 |
$487,450 |
|
37% |
$609,350 |
$731,200 |
· 2024 Increased Standard
Deduction. The standard deductions have increased for
each filing status:
Single - $14,600
HOH - $21,900
MFJ - $29,200
· Earned Income Tax Credit (EITC). The maximum EITC for 2024 is $7,830 for three or more dependents.
· Child Tax Credit. The refundable portion has
increased to $1,700.
· IRA Contributions. The annual contribution limit for
2024 is now $7,000. For age 50 and over,
the limit is $8,000. Remember, you have
until April 15 to contribute for the 2024 tax year.
· Bonus Depreciation. The bonus depreciation deduction is
60% in 2024.
· Gift Tax Exclusions. The annual gift tax exclusion increases to $18,000, and the lifetime exclusion increases to $13.61 million.
· Electric Vehicle Credit. Beginning in 2024, at least 40% of the battery components must come from North America or specified US Trading Partners. The credit can also be advanced at the point of sale and paid directly to the seller, but would need to be reconciled on the tax return.
2025 – Year
of Uncertainty
The Tax
Cuts and Jobs Act provisions are set to expire on December 31, 2025. If they are not extended, significant changes
may occur.
· Itemized deduction phaseouts would be in place.
· Standard deduction amounts would be greatly reduced.
· $10,000 limit on taxes as an itemized deduction will
be removed.
· Child tax credit would be reduced.
· Estate tax deduction would be greatly reduced.
We do
not know what changes will occur or what provisions will be extended. We will
keep you updated on developments throughout the year.
Call soon for a tax appointment! Evenings and weekends also available at your convenience.
The new IRS tax deadline for disaster-declared counties is now November 16, 2023.
Tax filings and payments are due by this time, without penalties.
The Internal Revenue Service and the California Franchise Tax Board have announced that taxpayers affected by the January 2023 winter storms in California will have until October 16, 2023 to file and pay their personal taxes. The extension also includes business tax filings.
The taxpayer must live in a county that has been declared a disaster area by FEMA. All other counties must adhere to the April 18, 2023 filing and payment deadline.
The following counties qualify for disaster relief:
Any others who reside or have a business outside those areas can call the IRS disaster hotline at 866-562-5227 to request the same tax relief at the federal level.
If you receive a notice from the IRS regarding any payments due by June 26, 2023, and you live in one of the disaster counties, you may disregard the notice. The IRS has issued a statement regarding notices sent to California taxpayers.
Thank you Denise for calling KCRA3 News to bring this matter to the attention of California taxpayers! Watch the video online at KCRA3 News here:
Californians receive payment notices for June despite IRS’s tax relief announcement (kcra.com)
Did you receive the Middle Class Tax Refund (MCTR) from the Franchise Tax Board (FTB) yet? If not, you should call the Money Network Customer Service number at (800) 542-9332, to report that you have not yet received any payment. Representatives are available Monday through Friday, 8 a.m. to 5 p.m. (PST).
Also, you may receive a Form 1099-MISC in the mail from the FTB. If you received more than $600 for the MCTR, the FTB is issuing this form to taxpayers. It is NOT taxable on the California tax return; however, we do not yet know if it will be taxed on the federal level. The Internal Revenue Service (IRS) has not yet issued guidance on these payments. There are many ways to interpret the tax code as to what type of payment this is.
We are waiting for the IRS to issue guidance on this matter. In the meantime, keep this form available for tax time.
As always, if you have questions, please call us anytime.
See you soon!
Tax Deadline Extended
California storm victims now have until May 15, 2023 to file taxes.
The IRS is offering relief to any area designated by the Federal Emergency Management Agency (FEMA) This means that individuals and households that reside or have a business in Colusa, El Dorado, Glenn, Humboldt, Los Angeles, Marin, Mariposa, Mendocino, Merced, Monterey, Napa, Orange, Placer, Riverside, Sacramento, San Bernardino, San Diego, San Joaquin, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, Solano, Sonoma, Stanislaus, Sutter, Tehama, Ventura, Yolo and Yuba counties qualify for tax relief.
Other areas added later to the disaster area will also qualify for the same relief.
Please visit the IRS website for more information:
Happy New Year! We hope your holidays were festive and joyous! We are ready for the new tax season that is already upon us!
Get your tax documents together and get ready to file taxes in the coming weeks. Remember, you may not receive your W2 or other tax documents until the end of January, which is when employers and other reporting agents are required to provide you with your tax documents. Some brokerage account 1099-Bs may not be mailed until February - March 2023, depending on the firm. It is best practice to wait until all of your documents arrive in order to avoid having to file an amendment.
What’s New for 2022
Tax Brackets and Rates
The income tax brackets are increasing to approximately 3.9%, due to inflation. The 2022 tax brackets are shown in the diagram below.
Key Tax Code Changes:
·
Increased teacher deduction. The deduction for
classroom supplies has increased to $300.
·
Child tax credit rollback. The advance child tax
credit now disappears, and the current credit rolls back to $2,000 per child.
· Dependent care credit rollback. The maximum qualified childcare expense for 2022 has been reduced to $3,000 for one child and $6,000 for two or more children.
· 100% meal deductibility.
Previously, businesses could only deduct 50% of their meal
expenses. To help restaurants recover from
the pandemic, businesses may now deduct 100% of meal expenses.
· Reporting digital payments.
If you receive more than $600 in digital payments for your business, you
may be issued a Form 1099-K in January.
This includes Venmo and digital ticket resellers.
· Virtual currency tracking. Brokers are required by the IRS to report cryptocurrency transactions beginning in 2023. Many firms are implementing the new reporting requirements in 2022.
·
Mortgage insurance premiums. Mortgage insurance
premiums are no longer deductible in 2022.
The 2017 Tax Cuts and Jobs Act eliminated this deduction, but Congress
later reinstated it. It expired in December
2021.
· Charitable giving deduction. The deduction for charitable giving for taxpayers who do not itemize on their return is no longer available in 2022. Congress created a temporary deduction through 2021 for charitable giving.
Charitable contributions may be
deducted on your tax return if you itemize deductions, and all qualified
deductions exceed $12,950 for single filers and $25,900 for married filers.
Schedule your tax appointment soon! Call or email for
an appointment. We look forward to seeing you soon!