01/08/2025
What's New? Tax Year 2024: Tax Law Changes
Income Tax Return Due Dates
Clients will have until Tuesday, April 15, 2025 to file their 2024 returns. If they live in Maine or Massachusetts, they will have until Thursday, April 17, 2025 due to Patriots’ Day and Emancipation Day holidays.
Tax Form Changes
Child Tax Credit - The maximum Additional Child Tax Credit (ACTC) is limited to $1,700 based on earned income.
Earned Income Tax Credit - The maximum credit for filing jointly as a married couple and claiming three or more qualifying dependents amounts to $7,830 in 2024, with the credit completely phased out at $66,819 of adjusted gross income (AGI). If your client is a single filer with no dependents, they can receive a maximum credit of $632, with the credit completely phased out at $18,591 of AGI.
Form 1099-K - The threshold for receiving a 1099-K form is set to decrease from $20,000 to $5,000.
Standard Business Mileage Rate - The rate is 67 cents per mile.
Standard Medical Mileage Rate - The rate is 21 cents per mile.
Standard Charitable Mileage Rate - The rate is 14 cents per mile.
Increased Standard Deduction - For Tax Year 2024, the Standard Deduction amounts are below:
Married Filing Jointly; Qualified Widower - $29,200
Single; Married Filing Separately - $14,600
Head of Household - $21,900
HSA Contribution Limits Increase
$4,150 for self-only coverage
$8,300 for family coverage
401(k) Contribution Limits Increase
$23,000 for employee contributions
$69,000 for combined employee and employer contributions
$7,500 for catch-up contributions for individuals 50 or older
Bonus Depreciation (Special Allowance)
Percentage of depreciation allowed decreased to 60% from 80%
Maximum depreciation on a new vehicle is $20,400
New E-File Mandate for Business Returns - The mandate to e-file returns if you prepare more than 250 returns has decreased to 10 for returns filed in 2025. This applies to Information Returns such as forms 1099, W-2, 1065, 1120, and 1120S in any combination that exceeds 10. It eliminates the exception for businesses with assets less than $10 million: https://www.irs.gov/newsroom/irs-and-treasury-issue-final-regulations-on-e-file-for-businesses
Note: The IRS has not released final instructions for Form 4562 or Schedule A.
IR-2023-31, Feb. 21, 2023 — The Department of the Treasury and the IRS today issued final regulations amending the rules for filing returns and other documents electronically (e-file). These regulations will require certain filers to e-file beginning in 2024.
