Tax Season Begins with Congressional Negotiations Over $78 Billion Tax Plan
Child Tax Credit Enhancements and Potential Impact on Tax Filings
According to CNBC, as tax season starts Congress is still working on a $78 billion tax plan that might change some rules including making the child tax credit better. These changes could affect how people file taxes for 2023. The IRS Danny Werfel said people should not wait for Congress. They should file their taxes when they’re ready. The changes to the child tax credit could make it easier to get give more money back and adjust for inflation in the future. This could mean families could get an average of $680 back in 2023 according to the Urban-Brookings Tax Policy Center. But it’s not clear if the bill will pass especially because some members of Congress don’t agree about a $10,000 limit on the amount of state and local taxes people can deduct from their federal taxes.
IRS and Tax Professionals Navigate Potential Tax Law Changes for Early Filers
Tax professionals are trying to figure out on how to handle possible tax changes that could affect people who file their taxes early. The IRS said if there are any changes that affect a person’s tax return they’ll fix it and send an update without the person needing to do anything else. But the tax return that was first filed needs to be right. The IRS plans to update their systems about six weeks after the tax package is approved by Congress if it is approved.
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