2023 Tax Season Is Different: What You Should Know This Year

(June 2024)

2023 Tax Season Is Different: What You Should Know This Year

In This Article

The 2023 tax season is going to be different from previous years. With the expiration of many pandemic-related tax breaks and the introduction of new tax credits, it’s important you prepare for what’s ahead.

You are ready to take on the 2023 tax season! Thanks to the IRS’s hard work and dedication, this year is shaping up to be the smoothest tax season yet.

Imagine this: you can now file your taxes electronically, choose direct deposit, and receive your refund within days. You also have access to a team of 5,000+ telephone assistors and in-person assistance at Taxpayer Assistance Centers across the country.

And with the Inflation Reduction Act passed in August, you can enjoy even more benefits, including Increased tax credits for clean vehicles, home energy, and childcare, Higher standard deductions and tax brackets, and Expanded free tax return preparation programs

You are in control of this tax season. With the IRS’s support, you can file your taxes with confidence and ease.

So what are you waiting for? Dive deeper into how to make this tax season your smoothest one yet.

What’s new and what to consider when filing in 2023

  1. Eligibility for Tax Credits
  2. Electronic Filing and Direct Deposit
  3. Premium Tax Credit (PTC) Changes
  4. Clean Vehicle Credit
  5. Smaller Refunds in 2023
  6. “Where’s My Refund?” Tool
  7. Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC)
  8. Additional considerations to bear in mind

Recap

1. Eligibility for Tax Credits

Considering filing your 2022 tax return? Well, here’s a noteworthy point for you: eligibility for tax credits could make a significant difference, even if you haven’t filed in the past. Even if your income currently sits below the usual filing threshold, filing that return could mean extra money in your pocket.

You, yes you, might be one of those who qualify – students, part-time workers, retirees – all have the potential to be eligible for certain tax credits or could get a tax refund simply by taking that step and filing a return. It’s a direct way for you to potentially benefit financially, so why not explore this opportunity?

2. Electronic Filing and Direct Deposit

When it comes to your tax refund, speed is of the essence, and you play a key role in this process. Opting for electronic filing with direct deposit is a must for you. Why? Because it’s not just about convenience; it’s about expediting the entire refund process and ensuring you get your money without unnecessary delays.

If you choose direct deposit, you can typically expect to see your refund in your account within 21 days. So, if you want your money sooner rather than later, consider the speed and efficiency of electronic filing with direct deposit.

3. Premium Tax Credit (PTC) Changes

This directly affects you because you might now qualify for temporarily expanded eligibility, especially if you or your family member is enrolled in a qualified health plan. To make the most of this opportunity, consider filing Form 8962.

This form is not just a piece of paper; it’s your ticket to computing and claiming the Premium Tax Credit on your tax return. So, as you navigate this tax season, remember that these changes could be in your favor – it’s all about ensuring you get the credits you’re entitled to.

4. Clean Vehicle Credit

The Inflation Reduction Act of 2022 has altered eligibility rules for claiming a tax credit for clean vehicles. This means you need to be in the know about these alterations to make sure you qualify for the Clean Vehicle Credit.

Take a moment to review these changes – it’s a crucial step for you. Ensuring you meet the criteria could mean claiming valuable tax credits, making it a tangible way for you to benefit from these alterations. Stay informed and make sure you’re eligible for the Clean Vehicle Credit as you navigate your tax responsibilities.

5. Smaller Refunds in 2023

To understand how this tax season is different, know the possibility of smaller refunds in 2023. There are a few factors at play here, and it’s essential for you to be aware of them. Firstly, there won’t be any additional stimulus payments included in tax refunds this time around.

Also, if you typically take the standard deduction, here’s a heads up – you won’t be able to deduct charitable contributions like you could on your 2021 returns. So, manage your expectations and understand the factors influencing your potential refund size. Stay informed and prepare for these changes as you navigate the tax landscape in 2023.

6. “Where’s My Refund?” Tool

Curious about your refund status? The “Where’s My Refund?” the tool on IRS.gov is your go-to. Check within 24 hours after your e-filed tax return is accepted to get a personalized refund status.

7. Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC)

If your refund includes the Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC), you won’t see it before mid-February. This isn’t a choice but a requirement under the 2015 PATH Act.

The IRS has to hold the entire refund, not just the EITC or ACTC portion, to safeguard against fraudulent refunds. But don’t worry – if you opted for direct deposit and everything else on your tax return checks out, you can anticipate most EITC/ACTC-related refunds to hit your account by Feb. 28. 

8. Additional considerations to bear in mind

  • Ensure you report all taxable income, even if you didn’t receive specific year-end documents like Form 1099-MISC, Form 1099-INT, or Form 1099-NEC.
  • Simplify your filing experience with the Interactive Tax Assistant on IRS.gov. Answer common tax questions tailored to your circumstances and determine filing requirements, credits, deductions, and more.
  • View or create an Online Account for secure access to your tax account information, including balances, payments, adjusted gross income, and more. Use the identity verification process for easy access.
  • When self-preparing taxes electronically, sign and validate your return with your prior-year Adjusted Gross Income (AGI) or Self-Select PIN. Find your AGI on line 11 of your 2021 Form 1040 or log in to your Online Account.
  • File your 2022 tax return even if you’re waiting on the processing of your 2021 return. Enter $0 for last year’s AGI and stay on top of your tax responsibilities.
  • Bookmark IRS.gov for quick access to online tools and resources. Get instant answers to tax questions, check refund status, and make payments without the need for appointments or wait times.
  • Schedule an appointment at a local IRS office for personalized assistance. Find the closest office with the Taxpayer Assistance Locator tool and explore available services.
  • Take advantage of extended hours at Taxpayer Assistance Centers nationwide, open one Saturday a month through May. Get in-person help without an appointment for your tax queries and concerns.

Recap

In the 2023 tax season, significant changes await, and it’s necessary for you to be well-prepared. With the conclusion of pandemic-related tax breaks and the introduction of new credits, your approach matters more than ever.

The IRS has streamlined the process, enabling you to file electronically, choose direct deposit, and receive your refund within days. Explore the benefits brought by the Inflation Reduction Act, including increased credits, higher deductions, and expanded free tax return programs.

As you consider filing, remember that eligibility for tax credits could impact your financial outcome, especially if you’re a student, part-time worker, or retiree. Speed up your refund process by opting for electronic filing with direct deposit, ensuring your money reaches you within 21 days. Stay informed about changes in the Premium Tax Credit and Clean Vehicle Credit, as they might offer additional financial advantages.

Be aware of the possibility of smaller refunds in 2023 due to the absence of extra stimulus payments and changes in deductibility. Utilize the “Where’s My Refund?” tool for real-time updates and understand that EITC and ACTC refunds might be delayed until mid-February.

Additionally, embrace the convenience of online tools, like the Interactive Tax Assistant, and create an Online Account for secure access to your tax information. Whether self-preparing your taxes or seeking in-person assistance, the IRS provides comprehensive support, ensuring a smoother and more efficient tax season for you in 2023.

This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor, or tax advisor with respect to matters referenced in this post. . For comprehensive tax, legal or financial advice, always contact a qualified professional in your area. S’witty Kiwi assumes no liability for actions taken in reliance upon the information contained herein.

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