Get Ready For Taxes: Here’s What’s New And What To Consider When Filing In 2022
Get Ready For Taxes: Here’s What’s New And What To Consider When Filing In 2022
The IRS encourages taxpayers to get informed about topics related to filing their federal tax returns in 2022. These topics include special steps related to charitable contributions, economic impact payments and advance child tax credit payments. Taxpayers can visit IRS.gov/getready for online tools, publications and other helpful resources for the filing season.
Here are some key items for taxpayers to know before they file next year.
Changes to the charitable contribution deduction
Taxpayers who don’t itemize deductions may qualify to take a deduction of up to $600 for married taxpayers filing joint returns and up to $300 for all other filers for cash contributions made in 2021 to qualifying organizations.
Check on advance child tax credit payments
Families who received advance payments will need to compare the advance child tax credit payments that they received in 2021 with the amount of the child tax credit that they can properly claim on their 2021 tax return.
- Taxpayers who received less than the amount for which they’re eligible will claim a credit for the remaining amount of child tax credit on their 2021 tax return.
- Eligible families who did not get monthly advance payments in 2021 can still get a lump-sum payment by claiming the child tax credit when they file a 2021 federal income tax return next year. This includes families who don’t normally need to file a return.
In January 2022, the IRS will send Letter 6419 with the total amount of advance child tax credit payments taxpayers received in 2021. People should keep this and any other IRS letters about advance child tax credit payments with their tax records. Individuals can also create or log in to IRS.gov online account to securely access their child tax credit payment amounts.
Economic impact payments and claiming the recovery rebate credit
Individuals who didn’t qualify for the third economic impact payment or did not receive the full amount may be eligible for the recovery rebate credit based on their 2021 tax information. They’ll need to file a 2021 tax return, even if they don’t usually file, to claim the credit.
Individuals will need the amount of their third economic impact payment and any plus-up payments received to calculate their correct 2021 recovery rebate credit amount when they file their tax return.
In early 2022, the IRS will send Letter 6475 that contains the total amount of the third economic impact payment and any plus-up payments received. People should keep this and any other IRS letters about their stimulus payments with other tax records. Individuals can also create or log in to IRS.gov online account to securely access their economic impact payment amounts.
Tips To Help Taxpayers Decide How And When To File An Amended Tax Return
After filing their tax return, taxpayers may find they made an error or forgot to enter something on it. The IRS strongly recommends taxpayers use the Interactive Tax Assistant, Should I File an Amended Return? to help determine if they should correct an error or make other changes to the tax return they already filed.
Here are some common reasons people may need to file an amended return:
- Entering income incorrectly
- Not claiming credits for which they’re eligible
- Claiming deductions incorrectly
The IRS may correct math or clerical errors on a return and may accept returns without certain required forms or schedules. In these instances, there’s no need for taxpayers to amend the return.
Taxpayers should also wait if they expect a refund. They need to allow time for their original tax return to be processed before filing an amended return. The IRS is automatically refunding money to eligible people who filed their tax return reporting unemployment compensation before changes made by the American Rescue Plan. It may take the agency more than 21 days to issue refunds for some 2020 tax returns that require review including incorrect recovery rebate credit amounts or returns that used 2019 income to figure the earned income tax credit and additional child tax credit.
Those who do need to amend their tax return might have questions about how to do so. Here are some things they should know, taxpayers:
- May now use tax software to file an electronic Form 1040-X. At this time, only tax year 2019 and 2020 Forms 1040 and 1040-SR returns can be amended electronically and only if the original 2019 or 2020 tax return was also filed electronically.
- Who cannot or chose not to file their 1040-X electronically should complete a paper Form 1040-X.
- Mail a paper 1040-X to the IRS address listed in the form’s instructionsunder Where to File. Taxpayers filing Form 1040-X in response to an IRS notice should mail it to the IRS address indicated on the notice.
- Should attach copies of any forms or schedules affected by the change.
- Need to file a separate Form 1040-X for each tax year. When mailing amended returns to the IRS, place each tax year in a separate envelope and enter the year of the original return being amended at the top of Form 1040-X.
- Should pay additional tax owed as soon as possible to limit interest and penalty charges.
- Must file Form 1040-X to claim a refund within three years from the date they timely filed their original tax return or within two years from the date they pay the tax, whichever is later.
- Can track the status of an amended return three weeks after mailing using the Where’s My Amended Return?
