Changes in the United States financial system mean that many families have to modify their financial plans year after year. This is also important for the IRS and taxes, as they are fundamental elements in the American economy. The annual changes do not have to imply something negative, as it could positively affect citizens at times.
Regardless of whether it affects positively or negatively it is necessary to know at all times what the IRS changes are for each year. Thanks to having full knowledge in this matter we will be able to act to achieve the best for ourselves. However, there are times when it is impossible to do anything positive with these changes.
Some years we simply have to accept the IRS changes and do our part. In the case that it affects our pocketbook, we have to save as much as possible in advance. That’s why we have to be well prepared. Because in case of need we won’t always be able to acquire the help we need. Will these new 6 IRS changes for this year 2023 affect you?
IRS Changes in 2023
Within these changes we can find interesting things and other things that are not so interesting. It is true that each situation with the IRS is individual. So each citizen will see it in a different way.
- Health insurance costs. Bruce A. Tannahill said that “Of interest to people who buy their health insurance on an exchange under the Affordable Care Act is that the Inflation Reduction Act increased the premium tax credit available to people enrolled in a qualified health plan,”. The director of MassMutual knows about the topic and that is his opinion.
- Drug costs and their prescription. Brian Mawhinney, head of financial planning with MassMutual, announces that “With the recent rise in inflation, retirees are confronted with balancing rising costs while living on fixed income. To help prevent seniors from forgoing essential services like healthcare, the Inflation Reduction Act attempts to address increasing healthcare costs through tackling rising prescription drug expenses. He also said that “The act allows Medicare to negotiate directly with pharmaceutical companies. For example, about one-quarter of Medicare recipients are dependent on life-saving insulin. As a result of the IRA, these costs will now be capped at $35 per month. Medicare beneficiaries also will receive greater financial protection with a $2,000 cap on annual out-of-pocket expenses for prescription drugs, saving many seniors up to $1,000 annually.”
- Energy-Efficient Home Improvement Credit. Levon L. Galstyan, Oak View Law Group CPA, said that “The Nonbusiness Energy Property Credit was renamed the Energy-Efficient Home Improvement Credit and extended through 2023. The credit will equal 30% of the expenses of all permissible home improvements performed during the year, beginning in 2023.”
More changes in 2023 taxes
There are other changes besides the 3 we have seen. In total, there are 6 changes that will change IRS taxpayer money.
- Clean Residential Energy Credit. “The Residential Clean Energy Credit … was set to end at the end of 2023 but has now been extended to 2034,” said Galstyan. In the other hand, he saldo said that “The Inflation Reduction Act also raised the credit amount, with the corresponding percentage phased out.” To that, we have to add that “Biomass furnaces and water heaters are no longer eligible for credit”.
- Credits for Clean Vehicles. “The Inflation Reduction Act adds new credits for qualifying clean commercial and previously owned clean vehicles, extending the Clean Vehicle Credit through the end of 2032”, said Galstyan as well.
- The IRS and Taxes. Galstyan said that “The IRS is putting together a strategy outlining how it intends to use the extra money.” And he also finished saying that “These resources are not about boosting audit scrutiny on small businesses or middle-income Americans. To better serve all taxpayers, especially small enterprises and middle-class taxpayers, additional resources will be allocated to hiring personnel and developing IT systems.”
So pay close attention to these changes so you don’t lose some of your money to the IRS.