Here’s why your tax refund may be smaller in 2023, the IRS says

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If you’re expecting a tax refund in 2023, it’s likely less than you paid this year. to the IRS.

Generally, if you overpay your annual taxes or withhold more than you owe, you’ll get a refund from the federal government.

Annual balance is based on taxable income and is calculated as adjusted gross income less standard or itemized deductions, whichever is greater.

“We may see smaller refunds in 2023,” the IRS said in a November news release in preparation for the upcoming tax season. “Taxpayers will not receive additional stimulus in the 2023 tax refund due to the lack of 2022 economic impact payments.”

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The agency is in the third round of $1,400 worth of stimulus package Per Capita and Eligible Americans in 2021 Unpaid funds can be claimed About this year’s tax return.

The average payout for the 2022 filing season was $3,176 as of Oct. 28, according to the company. National Tax Agencyup nearly 14% from $2,791 in 2021.

2022 charitable deduction ‘not as solid’ as 2021

moreover, Claim a charitable donation deduction Upon returning home in 2022, the IRS said.

Here’s why. “Deductions for charitable giving in 2022 aren’t as solid as in 2021,” said Margherita, CEO of Blue Ocean Global Wealth in Gaithersburg, Maryland, and her planner at Certified Financial. Mr Chen said.

as a response to COVID-19 PandemicCongress boosted charities by offering tax incentives for cash gifts in 2020, and lawmakers Extended tax cuts for 2021.

The increase in standard deductibles since 2018 has made it more difficult to classify deductibles, including tax breaks for charitable donations. Filers choose the greater of standard deductions or itemized deductions.

However, in 2021, you can claim up to $300 for cash donations and up to $600 for couples applying together. Bulleted or not.

However, the tax cut was not extended until 2022. That means taking a standard deduction eliminates the benefits of charitable donations, he said, the IRS said.

When to receive tax refund

As of November 18, there were 3.4 million outstanding individual tax returns received in 2022. This includes returns for previous tax years. reportThese pending returns are 1.7 million that require error correction or other special handling and 1.7 million document submissions.

agency is hired more workers To prepare for the upcoming tax season, Will add more, to clear backlogs and improve customer service.almost $80 billion in IRS funding Over the next decade, these efforts will be part of a broader plan for improving government agencies.

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