2023 tax filing season now underway
CHICOPEE, MA (WGGB/WSHM) - Monday marked the official start of tax filing season.
“The standard deduction has gone up, but the biggest difference this year is the credits and deductions that we typically get,” said Daniel Ladd with Glen A. Ladd Accounting and Tax Services in Chicopee.
Ladd also explained what changes you can expect to see this year when filing your 2022 tax return
“A lot of tax benefits from COVID have expired,” Ladd added.
One item that will impact families the most this year is the child tax credit. It has gone from a $3,600 a child in 2021 and fully refundable to $2,000 and only $1,500 is refundable in 2022. Another difference is there are no more charitable deductions for those taking the standard deduction.
“In 2020, you could take up to $300. In 2021, you could take up to $600. That has been removed and that is only if you take your standard deduction,” Ladd explained.
For those wondering if they should wait to file, Ladd suggested filing as soon as you get all your paperwork together.
“Usually, I say the best time to file is when you get all of your paperwork, so 1099 and W-2s all are due at the end of this month, so once you receive those, you are usually good to go,” Ladd noted.
Ladd’s advice for a quick turnaround on refunds is to set-up direct deposit to your bank account. However, not much else can be done since the turnaround time depends on the government, but he said the biggest worry this year will be refund shock.
“Without the stimulus payments, without the advanced childcare payments, some of the refunds on tax returns may be a little bit smaller,” Ladd said.
He pointed out that one way for business owners to get money back is the employee retention credit.
“This is for businesses that had employees on payroll in 2020 and 2021…If you saw your sales drop in 2020, 2021 compared to 2019, you can often times be eligible for a substantially large amount of credit back,” Ladd added.
Since April 15 is a Saturday this year, the official end of tax season is on Tuesday, April 18.
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