Tax season 2024 is upon us! Like every year, it’s important to know as much as possible about filing taxes in 2024, and the 2024 tax deadlines. It’s also a good idea to cover some basic tax preparation tips.
Every year, things tend to change slightly for taxpayers when it comes to preparing their tax returns. And even if you’re a student who either didn’t have any income or a job last year, or maybe you earned only a little bit, filing a tax return is going to become an annual ritual — much like putting on a costume for Halloween.
With that, here’s what you should know as you prepare for tax season 2024.
Tax season 2024: What to know
Some of the changes in store for tax season 2024 include phasing out of certain tax credits, such as pandemic-era changes to the child tax credit and earned income tax credit. That may not apply to students, but it’s good to know. Student loan payments also resumed this past fall, and borrowers are able to deduce the interest they paid on their loan balances against their incomes to reduce their tax liabilities.
If you experienced any type of student loan forgiveness, there may be tax implications to that as well — it may be best to consult with an account or financial professional if that’s the case. Note, too, that some states have different rules regarding tax exemptions and loan forgivness, so, again, it may be a good idea to talk to a professional.
You may have also heard about changes to 1099-K reporting rules — this had to do with platforms like Venmo sending people 1099-K forms if they met a certain threshold for transactions. This caused a lot of confusion, but you don’t need to worry about it for now. The IRS pushed back the implementation of the new rules.
Don’t forget to include any tax liabilities related to crypto trading, too. The IRS has a question about digital assets on tax returns, and you need to report any capital gains you made from crypto trading.
Tax preparation tips
Doing your taxes isn’t always easy, although it can be fairly simple for many people. But as mentioned, if you have any unique tax situations or complicated changes to your work or life, it may be a good idea to talk to an accountant. Yes, that’ll cost you some money, but it may be worth it to avoid the headache of trying to figure things out for yourself, and you may end up getting a bigger tax return than you’d pay in fees — so, it could be a wash.
For many, though, it may be a good idea to use one of the many tax-prep software services out there. We won’t name names, but you can find many of them, or use one of the IRS’ own tax-prep services that may be free for some taxpayers.
Remember that Tax Day is April 15, which is the deadline by which you need to file your return, or file for an extension. Again, if you only have one job and don’t have a side hustle or significant investment income, your return is probably going to be fairly simple and easy to do.
But it’s worth repeating: If you feel like you’re in over your head, consider talking to a CPA!
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