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United States Tax Change Highlights for 2022-2023

Due date of federal return extended, filing status name changed, certain child and family credits going back down, reporting requirements for Form 1099-K changing, no more "above-the-line" charitable deductions, new Standard Deduction amounts, Clean Vehicle Credit rules changed, 2023 inflation adjustments.

Due Date of Return
File your 2022 Form 1040 or 1040-SR by April 18, 2023. The due date has been extended because of the Emancipation Day holiday in the District of Columbia (even if you don't live in the District of Columbia).

Filing Status Name Change for Qualifying Widow(er)
The filing status Qualifying Widow(er) has been renamed to Qualifying Surviving Spouse. The rules for the filing status have not changed.

Amounts for Child Tax Credit (CTC), Earned Income Tax Credit (EITC) and Child and Dependent Care Credit Go Back to Previous Levels
Changes to these credits made by the American Rescue Plan Act of 2021 (ARP) were not extended into 2022, which means that taxpayers still eligible for these credits may receive a smaller refund than last year. For example:

Reporting Requirements for Form 1099-K
Form 1099-K is issued by third party settlement organizations and credit card companies to report payments made to you for certain types of income. For example, you might receive Form 1099-K if you earn business income through a Paypal account. In the past, this would occur when you made more than $20,000 and had more than 200 transactions. The IRS announced in early December, 2022 that Form 1099-K would now need to be issued when such payments exceed $600, for any number of transactions. However, it has not yet been widely reported that on Dec. 23 the IRS announced 2022 would be a transitional year, with Form 1099-K only required where gross payments exceed $20,000 and there are more than 200 transactions.

Of course, you have to report all income on your tax return unless excluded by law, whether you receive Form 1099-K or not. But if you do get a 1099-K, you should check it carefully to make sure it is correct. If you think it's wrong (perhaps it shows income you didn't actually receive, gifts or reimbursements between friends and family, or expense sharing), you should contact the Form 1099-K issuer and have it corrected as soon as possible.

No More "Above-the-Line" Charitable Deductions
During COVID, taxpayers could take up to a $300 ($600 if Married Filing Jointly) charitable donation deduction on their tax returns. However, you will need to itemize deductions on your return to get a tax break for donations in 2022. You would normally only do this if your itemized deductions exceed the Standard Deduction, which is uncommon (see below for Standard Deduction amounts).

Standard Deduction Amount Increased
For 2022, the standard deduction amount has been increased for all filers. The new amounts are:

Clean Vehicle Credit Rule Changes
There have been changes made to the rules for qualifying for a Clean Vehicle Credit

2023 Inflation Adjustments
The IRS adjusts certain amounts to inflation each year, and the 2023 amounts are going up quite a bit. This means that taxpayers could see bigger refunds or less tax owing when they file their 2023 returns in 2024.

The information on this website, and the use of this website, are both provided without warranty of any kind. Income tax rules change every year and some information may be out of date. All readers wishing to take advantage of the information offered here should consult a qualified income tax preparer. In no event will Brad Howland, Howland Tax Services, or this website be liable for any damages, including lost profits, arising out of the information offered on this website, or the usage of this website. All material on this website Copyright © 2001-2023 by Howland Tax Services, Inc. Please contact us for permission to use this material in any form. Website designed and maintained by Brad Howland.