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2022/2023 Tax Newsletter
The year is at an end and Tax Season is upon us! Get ready for the upcoming season by reading through our 2022/2023 tax newsletter for updates and tax law changes happening this season!
2022 Tax Brackets
The Tax due date is Monday, April 17th, 2023.
The tax filing due date falls on a Monday this season, giving taxpayers a few extra days to file their taxes on time. Please remember to provide all tax documents and forms at least 3 weeks prior to the due date, or an extension will automatically be filed for you.
Our New Client Portal using Tax Dome
With the use of Tax Dome, we now have a new client portal where you can access all your prior year tax returns and documents that you've filed with us. Now you can download a copy of your return anytime, anywhere! If you're interested in creating an account, give us a call and we will send you an invite via email!
What you need to know about extensions
If you can't file your taxes by the due date, then you will need to submit an extension. An extension extends the time to file your tax return until October 16th, 2023, but it does not extend the time to pay. If you owe, it is still due by April 17th. What's the point, then? It significantly reduces penalties on balances due, which can add up quickly.
Get in the habit of doing an annual paycheck checkup to make sure you are on track for your tax plans! Don't let anything surprise you at tax time, be prepared by getting an estimate ahead of time. All you need to do is provide a recent paystub, and we can provide you results and potential adjustments.
2022 Standard deduction
Form 1099-K Requirements
If you are paid over $600 for goods/services on apps like PayPal, Venmo, Etsy, Etc., you will receive a form 1099-K. Please be sure to include this with your tax documents. Paying friends or family through these apps will not trigger the form, most apps have the option to select whether the transaction is business related or not.
The Earned Income Credit (EIC) Increased
For the 2022 tax filing year, the maximum amount to receive in EIC is $6,935 with 3 qualifying children. To claim this credit, investment income must be below $10,300 and with 3 qualifying children, your income must be below $59,187 (married filing jointly) or $53,057 (Single or Head of Household).
The Child Tax Credit (CTC) returns to prior amounts
For the tax year 2022, you can receive up to $2,000 per child under the age of 17, and up to $1.400 per child is refundable. You can claim the full credit with up to $400,000 in income (married filing jointly) or up to $200,000 (single or head of household).
The Dependent Care credit is No longer refundable
n the prior year, taxpayers could get up to 50% credit on $8,000 in care expenses, while for the 2022 tax year, it lowers to 35% credit on $3,000 of care expenses. It is no longer refundable, meaning it can only lower what you owe, it will not increase your refund.
Residential Energy Credit (Solar Credit)
Originally known as the Residential Energy Efficient Property Credit, the now Residential Clean Energy Credit has increased from 26% to 30%. The credit was being reduced each tax year, and was expected to expire in 2024. Now, it will stay at 30% until 2033, where it will begin to drop once again.
Teacher Expenses deduction increased
The deduction for teacher expenses is increasing from $250 to $300 per filer. You must be an eligible educator to take this deduction, including anyone who is a K - 12th grade teacher, instructor, counselor, principal, or aide.
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