Tax Express Group

Increased Additional Child Tax Credit Available for 2023 – Did You Know?

The maximum Child Tax Credit (CTC) amount remained at $2,000 per qualifying child for tax year 2023 and generally isn't a refundable credit. However, many taxpayers who qualify for the CTC are also eligible for the Additional Child Tax Credit (ACTC), which may make the CTC partially refundable. In other words, if your CTC amount exceeds the tax you owe, claiming the ACTC may enable you to receive part of the excess credit as an IRS refund.

Unlike the basic CTC, the ACTC gets adjusted annually for inflation. For 2023, the maximum ACTC amount rose to $1,600 per qualifying child. Therefore, those who qualify for the ACTC may receive up to $1,600 per qualifying child as a tax refund. However, you must file a tax return to claim your refund, even if you do not owe any tax.

A tax professional can help you determine whether you qualify for the 2023 CTC and ACTC, and if so, help you file a return electronically to get your refund as quickly as possible.

Tax Filing Season Begins

The 2024 Tax Filing Season opens today, January 29th, 2024, for your 2023 returns. Here are some tips to make your tax filing season easier.

Gather Documents Showing Wage, Business And Other Income:
If you work as an employee, you should receive a W-2 from your employer(s) by early February, showing your earnings for the year and the total tax withheld from your paychecks. If you are self-employed (including gig economy work) or own a business, you may also receive 1099 forms from your clients showing fees paid to you.

Interest and dividend income, along with royalties from past work, are also reported on 1099 forms. Recipients of unemployment benefits and/or taxable Social Security benefits should receive a year-end statement detailing these payments as well. Store all of these documents with your tax records.

Organize Records Of Other Potentially Taxable Transactions:
The sale of major assets like stock, a house or any other “big ticket” item may yield a taxable capital gain. Many cryptocurrency transactions (such as buying and selling Bitcoin) also have tax implications, since the IRS classifies cryptocurrencies as property. Make sure you have complete records of all your significant financial and property transactions during 2023.

Start Early:
Assemble your records and file your taxes early. If issues come up, you'll have much more time to resolve them. A tax professional can help you with identifying and organizing your documents as well as filing your tax return.