If you don’t want your 2024 tax return to become a headache, here are some fresh tips to make everything go smoothly. Don’t worry, it’s not that complicated if you take it easy and avoid the classic mistakes that make us all sweat. Ready to learn some tricks?
First golden rule: no rush. Before sending your tax return, check that you have all the papers in order (W-2, 1099, income receipts, etc.). If something is missing or there are errors, fix it now. A poorly placed detail can delay your refund or, worse, get you into trouble with the IRS. Better safe than sorry!
Credits that are your best ally (and other key changes)
Did you know that this year there are adjustments that could leave you more money in your pocket? For example, the ACTC rose to $1,700 for each qualifying child. And if you live in Puerto Rico, now you can claim it with just one child, without needing three or more. Take advantage of it!
Now, the Child Tax Credit (CTC) is still a top: $2,000 per child, but be careful, it is reduced if you earn more than $200,000 (or $400,000 if you file as a couple). Additionally, your child must be under 17 and meet certain requirements. Do you have doubts? Check the rules on the IRS website.
Standard deduction: more money in your pocket
This year, the standard deduction went up, and that’s pure profit. See the updated numbers:
- Single or married filing separately: $14,600.
- Head of household: $21,900.
- Married filing jointly: $29,200.
Feel like a pro and use these figures to your advantage. Also, the EITC (income credit) has a new rule: if you do not have children, you must be between 25 and 65 years old to claim it.
Bonus: special credits that you can’t miss
Adopting a child is a joyous occasion, and the tax system offers some support for the significant costs involved. If you finalized the adoption of a child in 2024, you may be eligible to claim the Adoption Credit. This credit can provide substantial financial relief, with a maximum credit of up to $16,810 per adopted child.
The push for cleaner transportation has led to the availability of tax credits for those who purchase qualifying electric or hybrid vehicles. If you purchased a new or used electric vehicle or a plug-in hybrid in 2024, you might be able to claim a credit Review Form 8936; Maybe you qualify for a juicy loan.
Save for retirement: For the 2024 tax year, the contribution limits for IRAs have been increased. Your IRA contribution limit rose to $7,000 (or $8,000 if you’re 50+).