According to IRS- Internal Revenue Service, in 2022, your refund will be smaller in comparison to past years, for the 2022 tax year, IRS said on Wednesday. This is because of many currently passed changes to the tax code.
According to the IRS, taxpayers who choose to include their taxes instead of using the standard deduction will no longer be allowed to claim their charitable contributions. The American Rescue Plan Act of 2021 also lowered the threshold for reporting for third-party networks that handle payments for individuals doing business.
The 1099-K form which is meant for third-party networks, can now able to triggered by a single transaction that surpasses $600. To trigger the form the threshold used to be $20,000 in a set of transactions. For those people who are claiming for EITC- Earned Income Tax Credit and ACTC- Additional Child Tax Credit, the IRS said those returns can’t be issued till mid-February because it needs to hold the entire refund by the law, in an attempt to provide more time to detect fraud.
For the tax years; 2020 and 2021 some huge refunds were allotted because the taxpayers who still have not received their stimulus payments claimed them, during they filed for their taxes.
The IRS told, it is unable to update forms for people who use payment processors and receive 1099-Ks for non-taxable income such as personal gifts or reimbursements for personal costs. However, taxpayers must contact the provider by phone call. Currently, there are some expanded and new tax credits that might be available for taxpayers, it consists of Clean Vehicle Credit and Premium Tax Credit.
On 11 November 2022, IRS admitted that there were 3.7 million unprocessed resident returns still received by IRS. Also, for amended tax returns there were 900,000 unprocessed forms 1040-X available. “These amended returns are processed by IRS in received order and the recently given time can be expected by over 20 weeks,” told by IRS in the release. If you are a taxpayer, you must check twice where’s your amended return, for the current updated processing status which is available.