Stay informed on the latest tax news and developments, including legislation and rule changes, for effective tax planning and compliance.
Review your tax withholding now, before time runs out, to avoid a surprise next year
As 2023 ends, the IRS urges taxpayers to check their withholding to prevent tax filing surprises next year. Quick adjustments now can fix over- or under-withholding. The IRS's Tax Withholding Estimator can guide taxpayers on the right amount to withhold. Employers typically handle withholding, but self-employed individuals or those with other income sources should consider quarterly estimated tax payments. Payments can be made online or through the IRS2Go app. Life events like marriage or job loss can affect taxes, and for those affected by disasters, special tax provisions may apply. For a faster refund, file electronically and opt for Direct Deposit. Most refunds are issued within 21 days, but it can vary. Visit IRS.gov/account for assistance.
The 2024 401(k) cap is $23,000, while the IRA cap is $7,000
In 2024, the IRS has raised 401(k) contribution limits to $23,000 from $22,500. IRA contribution limits are now $7,000, and the over-50 catch-up remains $1,000. Employees over 50 can add up to $30,500 to certain plans. Income phase-out ranges for deductible IRA contributions and Roth IRA eligibility have increased for all filing statuses. The Saver's Credit income limit also went up, alongside SIMPLE account contributions to $16,000. SECURE 2.0 maintains the $200,000 limit for longevity annuity contracts and raises some charitable distribution limits.
IRS offers Energy Credit for clean cars. Dealers can register online for advance payments and report sales
IRS launches IRS Energy Credits Online (IRS ECO), a tool for clean vehicle sellers to register for advance credit payments and issue Time of Sale reports, key for claiming federal tax credits. Essential for small businesses, this tool ensures advance payments within 72 hours and real-time VIN confirmation. Starting in 2024, vehicle sellers must use IRS ECO for credit claims on new or used clean vehicles. Enrollment is now open, with multi-user access coming in December 2023.
IRS prolongs flexibilities, keeps e-signatures and secure email, improving taxpayer interactions
IRS maintains digital sign-offs and secure email to enhance user experience. Initially COVID-19 measures, these options now extend to aid compliance and IRS interactions. Doug O'Donnell notes their importance in a digital shift, with IRM updated to include varied signature methods. Secure email is available until Oct. 31, 2025, as part of a move towards lasting electronic solutions. These steps, part of IRS’s tech-forward strategy, aim to ease processes while upholding security against identity theft and fraud.
