The 2024 tax season could bring relief for many Americans grappling with the rising cost of living. Rumors suggest the Internal Revenue Service (IRS) may revise tax brackets to effectively reduce income tax percentages for many citizens. This could potentially save taxpayers thousands of dollars.
Inflation has touched all aspects of life, from grocery shopping to housing costs, healthcare, and education. Its effect combined with sputtering wage growth has resulted in citizens struggling to maintain their standard of living.
Herb Weisbaum, a contributor at Checkbook.org, highlights potential benefits from inflation-adjusted standard deductions. Such increases could result in some pay less tax this year, even without a wage increase. This is especially true for those who do not itemize deductions.
Weisbaum further explains adjustments made due to inflation in tax brackets could land people in lower brackets. But, he also warns these advantages might not significantly counterbalance other increasing expenses and advises taxpayers to be ready for any eventuality.
Additional tax reductions can be achieved by qualifying for other deductions like the clean vehicle tax rebate that can save you up to $7,500. Eligibility often includes specifics related to income, purchased vehicle’s MSRP, and its origin. Additional tax credits include the renewable energy, electric vehicle, and homeowners’ deductions. These potentially save thousands, but eligibility involves understanding detailed prerequisites and meeting accordingly for optimal tax benefits.
To ward off potential scams, taxpayers are encouraged to verify their eligibility for the IRS’s Free File program and to use free tax services offered directly on the IRS website.
For a quicker, safer tax return process, electronic submissions are encouraged. This method not only speeds up the process but minimizes risk of personal information being lost, allows real-time tracking of return status, and reduces possibilities of input errors causing delays or discrepancies.
