Summer Activities That Could Affect People’s Tax Returns Next Year
While summer is a time for fun, it’s never the wrong time to be thinking about taxes – and some of those summer activities could have an impact. Here are a few summertime activities and tips on how taxpayers should consider them for filing season.
Marriage
Wedding season is upon us, and newlyweds can make their tax filing easier by taking two simple steps now:
First, report any name change to the Social Security Administration.
Next, notify the United States Postal Service, employers and the IRS of any address change. To officially change their mailing address with the IRS, taxpayers must complete and submit Form 8822, Change of Address. See page 2 of the form for detailed instructions.
Summer camp
If a taxpayer is sending a child to summer camp, the cost may count toward the Child and Dependent Care Credit.
Business travel
Kids may have the summer off, but parents generally don't – and business travel happens year-round. Tax deductions are available for certain people who travel away from their home or main place of work for business reasons. Whether a business traveler is away for a few nights or all summer long, it’s important for them to remember the tax rules related to business travel.
Part-time work
While summertime and part-time workers may not earn enough to owe federal income tax, they should file a tax return to get any refund they may be owed. Part-time and seasonal workers can visit IRS.gov to learn more about who should file a tax return.
Some taxpayers earn summer income with a side hustle or doing gig work. They can visit the Gig Economy Tax Center at IRS.gov to learn how participating in the gig economy can affect their taxes. If taxpayers are paid through payment apps for goods and services during the year, they may receive an IRS Form 1099-K for those transactions. For more information, go to IRS.gov/1099k.
Home improvements
The IRS has information to help taxpayers take advantage of potential tax benefits for home improvements. If taxpayers make qualified energy efficient improvements to their home after Jan. 1, 2023, they may qualify for a tax credit up to $3,200. They can claim the credit for improvements made through 2032.
These types of improvements include Energy Efficient Home Improvement Credits for things like water heaters, exterior windows and doors and heating and air conditioning installations. Residential Clean Energy Credits are available for taxpayers who install solar water heaters, fuel cells and battery storage or solar, wind and geothermal power generation. Taxpayers can visit the Home Energy Tax Credits page on IRS.gov to learn more.
For more information and to read this original article in its entirety, head to the IRS’s website at this link.