Some changes to tax relief options and forms could mean good things for your refund. Learn about a few basic steps you can take in areas such as your retirement account and energy spending to potentially see an increase.
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Recent congressional acts have made a number of adjustments to the tax code, and some of these changes may affect your refund. We've rounded up 10 recent and important tax law changes that can potentially increase the amount you are refunded. It's best to review the changes that have occurred every tax year so you can be sure not to miss out on any refund advantages when you file.
The once temporary American Opportunity Credit has now been made permanent. Depending on income and filing status, taxpayers who pay college-related costs for themselves, a spouse, a child, or another dependent can receive a credit for up to $2,500 in tuition and related expenses, such as course materials.
Here's how it works: You get a credit for 100% of the first $2,000 you spend on post-secondary education. After that, you can claim a credit of 25% of up to the next $2,000. The credit is partially refundable, so if it reduces the taxes you owe below zero, you can receive up to $1,000 in the form of a refund.
The SECURE Act and the CARES Act have created several tax-law changes for retirement plans. Here are the highlights:
The Standard Deduction is also undergoing tax law changes in 2023 and 2024.
| Filing Status | Standard Deduction |
| Married filing jointly under the age of 65 | $27,700 |
| Married filing jointly over the age of 65 | $27,700 plus $1,500 for each spouse over the age of 65 |
| Single or married filing separately under the age of 65 | $13,850 |
| Single or married filing separately over the age of 65 | $15,700 |
| Heads of household under the age of 65 | $20,800 |
| Heads of household over the age of 65 | $22,650 |
| Filing Status | Standard Deduction |
| Married filing jointly under the age of 65 | $29,200 |
| Married filing jointly over the age of 65 | $29,200 plus $1,550 for each spouse over the age of 65 |
| Single or married filing separately under the age of 65 | $14,600 |
| Single or married filing separately over the age of 65 | $16,550 |
| Heads of household under the age of 65 | $21,900 |
| Heads of household over the age of 65 | $23,850 |
To adjust for inflation, the IRS has adjusted the 2023 income limits for all tax brackets:
| Filing status and income | Marginal Tax Rate |
| Single over $578,125 |
Married filing jointly over $693,750
Married filing jointly over $462,500 to $693,750
Married filing jointly over $364,200 to $462,500
Married filing jointly over $190,750 to $364,200
Married filing jointly over $89,450 to $190,750
Married filing jointly over $22,000 to $89,450
Married filing jointly up to $22,000
The IRS has further adjusted the 2024 income limits for all tax brackets as well:
| Filing status and income | Marginal Tax Rate |
| Single over $609,350 |
Married filing jointly over $731,200
Married filing jointly over $487,450 to $731,200
Married filing jointly over $383,900 to $487,450
Married filing jointly over $201,050 to $383,900
Married filing jointly over $94,300 to $201,050
Married filing jointly over $23,200 to $94,300
Married filing jointly up to $23,200
For tax years 2022 through 2032, you may be able to claim a credit worth 30% of the cost of certain energy-efficient equipment installed in your home, including solar water heaters, solar panels, fuel cells, and wind turbines. The credit is not refundable, but the excess can be carried forward to future tax years.
For 2020 and 2021, the CARES Act suspended the 60% of AGI limit for most charitable cash deductions, which allows for more deductions by taxpayers who itemize. This does not apply if the cash donations go to a donor-advised fund or private nonoperating foundation. Additionally, taxpayers who don't itemize can deduct qualified charitable cash contributions up to $300 in 2020 and 2021 regardless of filing status and up to $600 in 2021 if married filing jointly.
For 2023 you will need to itemize your deductions to claim your charitable contributions.
In 2020, the IRS changed the Form W-4. Workers no longer claim withholding allowances on the form. The new Form W-4 is now simplified and requires information about filing status, number of dependents, number of jobs, estimated tax breaks, and other income that may be reported on a 1040. Employees are not required to submit a new Form W-4 unless they are hired after 2019 or want to adjust their withholdings.
For tax year 2020 and onward, Form 1099-MISC has been revamped and Form 1099-NEC is back. Because of these changes, employers will no longer report nonemployee compensation of $600 or more on Form 1099-MISC. These types of payments to non-employees should be reported on a Form 1099-NEC. These payments include commissions, fees, prizes, awards, or any form of compensation to nonemployees. These forms should be given to the payee and filed with the IRS by January 31 each year.
The IRS planned to implement changes to the 1099-K reporting requirement for the 2023 tax year. However, the IRS recently delayed the implementation of the new $600 reporting threshold for transactions from third party processors like Venmo and Paypal, reverting tax year 2023 back to the previously higher 1099-K reporting threshold (over $20,000 in payments and more than 200 transactions).
However, some individual states have already begun to use the lower reporting threshold. Maryland, Massachusetts, Vermont, Virginia and the District of Columbia have a $600 threshold for requiring 1099-K in effect for 2023. North Carolina and Montana also have a $600 threshold, although state tax officials have said these states may offer relief. If you don’t receive a 1099-K, the IRS still expects you will report all your income, regardless of the amount.
There is no threshold for payment card transactions.
For taxpayers who itemize on Schedule A or self-employed taxpayers who complete a Schedule 1 of Form 1040, the limits for long-term care premium deductions have been raised for 2023 and 2024.
In early 2013, Congress made the AMT "patch" permanent to prevent millions of taxpayers from having to pay AMT in 2013 and beyond.
The exemption amounts for 2023 are:
The exemption amounts for 2024 are:
If you installed certain energy-efficient equipment in your home, such as solar water heaters, solar panels, fuel cells, and wind turbines, you may be able to claim a credit worth 26% of the expense in tax years 2020 and 2021. The credits jump back up to 30% beginning in 2022 through 2032. After this it goes back down to 26% for 2033 and to 22% in 2034. The credit expires after 2034. The credit is not refundable, but the excess can be carried forward to future tax years.
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