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NEWSLETTERS AND RESOURCES

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NEW TAX LEGISLATION

  • The Inflation Reduction Act has been signed into law. So, what does that mean for you? Maybe not much, but there might be some opportunities. First, to share some wise words: only consider expenditures if it still makes sense without any tax benefit.
    • Most residential energy credits (IRC Sec. 25C) like insulation, windows, doors and energy-efficient furnaces are extended through the end of 2032 instead of expiring at the end of 2021 (Sec.13301)
    • The 2022-2032 home solar/wind credit (IRC Sec. 25D)has been increased back to 30% for 2022 and extended for 10 years at that rate (Sec.13302).
    • A new credit equal to 30% (max $4,000) would apply for buyers of electric vehicles that are more than 2 years old. It must be bought from a dealer and be the 1st resale. The credit is reconciled when filing your individual tax return. (Sec.13401).
    • The $7,500 maximum credit is back, but only if certain US component thresholds are met and it applies at the point of sale. According to the Congressional Budget Office only 30% of electric vehicles would qualify under the stringent thresholds of US material component requirements. (Sec. 13401)

THE IRS & YOUR TAXES

  • We recommend accessing your taxpayer account and records with the IRS to match tax payments, credits, and what is being reported to the IRS.
  • Tax notices, correct or incorrect, are on the rise. https://www.irs.gov/payments/view-your-tax-account
    • Penalties and interest rates are also on the rise. Now at 6%, whereas a year ago the interest rate was at 3%.
    • Statute of limitations is different depending on when or if you filed a tax return. Claims for refunds do expire!
    • 2022 Standard Mileage rates:
      • 58.5 cents per mile driven for business use from 01-01-2022 thru 06/30/2022,
      • 62.5 cents per mile driven for business use from 07-01-2022 thru 12/31/2022,
      • 18 cents per mile driven for medical, or moving purposes for qualified active-duty members of the Armed Forces, from 01-01-2022 thru 06/30/2022,
      • 22 cents per mile driven for medical, or moving purposes for qualified active-duty members of the Armed Forces, from 07-01-2022 thru 12/31/2022, and
      • 14 cents per mile driven in service of charitable organizations; this rate is set by statute and sadly remains unchanged

    ARIZONA & YOUR TAXES

    • Moving to Arizona? We're moving to a 2.5% flat tax for 2023.
    • Keep your records a little longer - Arizona has a 4-year statute of limitations (the IRS is 3 years)
    • Education Savings Deductions are per Beneficiary, not per Taxpayer
      • Contributions to college savings plans (529 Plans) are $2,000 per *beneficiary* ($4,000 per beneficiary for a married filing joint return)
      • Here's some more education on saving for education: https://az529.gov/faq/
    • In addition to claiming a standard deduction you can claim 27% of qualified charitable contributions made during the year (up 2% from 2021 tax year).
    • Use available Arizona taxes with Charitable Tax Credits to pay your taxes. You have until 04/15/2023 to make donations and apply them to 2022.

    Updated 11/14/2022


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    Contact our office to address your specific accounting, tax or other planning needs. This website is a valuable resource. Material is intended to provide accurate, current and general information.