Wednesday, February 8, 2023

IRS warns taxpayers about ‘small refunds’ in 2023, here’s why

NEW YORK — While some people can expect to receive their tax returns in 2023, the IRS warns that smaller refunds will be available.

The IRS issued an announcement encouraging taxpayers to prepare for the upcoming tax season, and warned people to lower their expectations for their next tax refund.

“Refunds may be lower in 2023,” the IRS said. “Taxpayers will not receive additional stimulus payments with 2023 tax refunds because there were no economic impact payments for 2022.”

Not all eligible recipients received their checks in 2021, despite the fact that no stimulus checks were distributed in 2022.

Those who missed to claim the dues when they filed their taxes in 2022. This made the tax refund for millions of Americans much higher than normal.

There was not another round of stimulus checks in 2022, so this will not happen again.

Who gets tax refund? What is the average amount?

IRS data shows that the average tax refund paid earlier this year was much higher than in years past. For example, the average refund in 2022 was $3,176, up nearly 14% from last year’s refund of $2,791. In 2020, the average refund was approximately $2,550.

Although not all tax filers get a refund, most do. Two-thirds of all 2022 taxpayers received a tax refund from the IRS, according to agency data.

Although millions of people rely heavily on refund checks each year, the IRS advises against that strategy.

“The IRS is warning taxpayers not to count on receiving their 2022 federal tax refund by a certain date, especially when making large purchases or paying bills,” the agency said. “Some returns may require additional review and may take longer.”

Currently, the agency is still processing millions of tax returns. According to the IRS, there are still 3.7 million unprocessed returns this year. Processing delays are caused by errors, processing delays and poor customer service, according to a report by the National Taxpayer Advocate, an internal IRS watchdog.

While the IRS no longer has to deal with pumping out hundreds of millions in stimulus payments, a new rule enacted by the US bailout plan is in place for the next tax season. The rule affects many people with secondary problems who use third-party payment services like PayPal or Venmo, or sites like Facebook Marketplace, Ebay, or Etsy.

In short, those businesses are now required to send 1099-K forms to anyone who used their platform to sell goods or services worth more than $600 (gifts or personal payments do not apply). Previously, the limit was 200 transactions or $20,000. Those who didn’t meet that threshold in previous years were required to report their income to the IRS, but tax experts say many people don’t know they’re about to file a return, or in some cases miss that requirement. Ignore, if not they do. Document not received.

Now, that new document is coming, and many people will be filing taxes for the first time. It can also contribute to fewer tax refunds for some taxpayers, and if there are errors on the return, it can lead to further delays with the IRS.

To prevent another huge delay from happening next year, the IRS is on a recruiting spree. The agency said in late October that it has already hired 4,000 new customer service employees and plans to add 1,000 more by the end of the year.

To increase your chances of getting a quick refund, the IRS recommends that you file electronically and sign up for direct deposit.

Nation World News Desk
Nation World News Deskhttps://nationworldnews.com
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