As the tax season deadline looms, there’s been a 1.7% drop in filed income tax returns compared to last year, with 54,030,000 processed by March 1, 2024. The IRS reports that 44% have received refunds, 2% less than last year, indicating slower processing.
Electronic filing has been a surge, signifying a shift from traditional mail filing. This is probably an outcome of the global digital transition. Considerations, including automated systems, are being explored to expedite processing.
This year’s tax season started a week late, reducing the season to 78 days instead of 86. However, this change hasn’t accelerated filing. Certain tax regulation changes have added complexity and time requirements, causing stress to taxpayers.
The pending Tax Relief for American Families and Workers Act could slow filing rates.
Digital shift impacts tax return rates
The Act proposes a retroactive expansion of the child tax credit. If passed, it could increase from $2,000 to $3,600 for children under 6 and from $3,000 to $3,000 for children aged 6 to 17.
In his State of the Union address, President Biden recommended Congress to extend the child tax credit. However, he didn’t mention the famous research and development tax credit, leaving businesses worried about offsetting investment costs.
President Biden is pushing for higher taxes for billionaires while promising no raise for those earning under $400,000 annually. His administration also aims to close numerous tax loopholes.
Biden’s proposal to raise the corporate tax rate to a minimum of 21% is stirring debates. He seeks to remove tax benefits for sectors like pharmaceuticals, the oil industry, and executive pay. Despite potential opposition, Biden emphasizes the need for corporate accountability.
Finally, the Justice and Treasury Departments appealed the decision that nixed the Corporate Transparency Act (CTA). The decision halting the Treasury from implementing the CTA remains in place until the appeal is resolved.
