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Applicable Federal Rates for December 2022

The IRS in Revenue Ruling 2022-22 has issued the various prescribed rates for federal income tax purposes. What Is the Applicable Federal Rate (AFR)? The applicable federal rate (AFR) is the minimum interest rate that the Internal Revenue Service (IRS) allows for private loans. Each month the IRS publishes a set of interest rates that the […]

New Retirement Limits in 2023

On October 21, 2022, the IRS announced the 2023 retirement contribution limits to reflect the change in the headline consumer price index for regular and Catch-up contributions.  Catch-up contributions are for those aged 50 or older. 2022 2023 Increase 401k $20,500 $22,500 $2,000 Catch-Up $6,500 $7,500 $1,000 Traditional IRA $6,000 $6,500 $500 Roth IRA $6,000 […]

Applicable Federal Rates for November 2023

The IRS in Revenue Ruling 2022-20 has issued the various prescribed rates for federal income tax purposes. What Is the Applicable Federal Rate (AFR)? The applicable federal rate (AFR) is the minimum interest rate that the Internal Revenue Service (IRS) allows for private loans. Each month the IRS publishes a set of interest rates that the […]

Social Security Changes for 2023

The Social Security Administration (SSA) announced that there will be an 8.7% increase in benefits in 2023.  If you do not already have a SSA account, you can create one on the SSA website at “SSA.gov”. For those still working, the SSA also announced that the maximum amount of earnings subject to the Social Security […]

Taxation of Student Loan Relief

When any type of loan is forgiven, the amount forgiven is called cancellation of debt (COD) and is taxable, unless specifically exempt.  As part of the American Rescue Plan of 2021, Congress enacted Section 108(f)(5) of the Internal Revenue Code to expand the types of student loan forgiveness that would not be treated as taxable […]

Inflation Reduction Act

President Biden signed into law The Inflation Reduction Act on August 16, 2022.  The key provisions are: Clean energy tax credits for homeowners – current tax credits for solar and wind power are extended to 2032; eligible homeowners could qualify for a 30% tax credit. Rebates for electric cars – Existing tax credits for the […]

President Biden Announces Student Loan Relief:

President Biden announced a three-part plan addressing student loan debt. The first part of the plan would allow $20,000 in debt forgiveness if a taxpayer went to college on a Pell Grant, or $10,000 without the assistance. Debt forgiveness applies only to those earning less than $125,000 a year ($250,000 for married couples). The plan […]

IRS interest rates increase for Q4

The Internal Revenue Service announced that the interest rates they charge and pay will go up for the quarter beginning October 1, 2022.  The rates will be: 6% for overpayments (5% in the case of a corporation); 3.5% for the portion of a corporate overpayment exceeding $10,000; 6% for underpayments; and, 8% for large corporate […]

IRS increases what teachers can deduct for classroom expenses for 2022

As the school year begins, the IRS is telling educators that they can deduct up to $300 of out-of-pocket classroom expenses, the first increase in two decades. The special educator expense deduction increase is the first since it was enacted in 2002 with a $250 annual limit, and the IRS said in a release this […]

IRS increases mileage rate for remainder of 2022

On June 9, 2022, the Internal Revenue Service announced an increase in the optional standard mileage rate for the final 6 months of 2022. Taxpayers may use the optional standard mileage rates to calculate the deductible costs of operating an automobile for business and certain other purposes. For the final 6 months of 2022, the […]