Important Tax Alerts and News

Taxpayers face a number of issues due to critical tax law changes that took place in 2022 and ongoing challenges related to the pandemic. The IRS continues to share updated information for people preparing to file their 2022 tax returns as well as anyone who has previous year tax returns awaiting processing by the IRS.

This page will be updated with special alerts designed to help anyone whether they are now preparing their tax return or are awaiting processing of a return or refund and the latest updates on IRS letters, or notices. Newer updates will be placed at the top of this page; the IRS will also provide critical updates through social media.

Topics on this page:

2022 changes that may affect your tax refund. Changes in the number of dependents, employment or self-employment income and divorce, among other factors, may affect your tax-filing status and refund for 2023.

No additional stimulus payments. Unlike 2020 and 2021, there were no new stimulus payments for 2022 so taxpayers should not expect to get an additional payment in their 2023 tax refund.

Some tax credits return to 2019 levels. This means that taxpayers will likely receive a significantly smaller refund compared with the previous tax year. Changes include amounts for the Child Tax Credit (CTC), the Earned Income Tax Credit (EITC) and the Child and Dependent Care Credit will revert to pre-COVID levels.

  • Those who got $3,600 per dependent in 2021 for the CTC will, if eligible, get $2,000 for the 2022 tax year.
  • For the EITC, eligible taxpayers with no children who received roughly $1,500 in 2021 will now get $560 for the 2022 tax year.
  • The Child and Dependent Care Credit returns to a maximum of $2,100 in 2022 instead of $8,000 in 2021.

Visit Credits and Deductions for more details.

No above-the-line charitable deductions. During COVID, taxpayers were able to take up to a $600 charitable donation tax deduction on their tax returns. However, for tax year 2022, taxpayers who don't itemize and who take the standard deduction, won't be able to deduct their charitable contributions.

Updates

February 3 update

IRS issues statement about the taxability of state payments

The IRS is aware of questions involving special tax refunds or payments made by states in 2022; we are working with state tax officials as quickly as possible to provide additional information and clarity for taxpayers.  There are a variety of state programs that distributed these payments in 2022 and the rules surrounding them are complex. We expect to provide additional clarity for as many states and taxpayers as possible next week.

For taxpayers uncertain about the taxability of their state payments, the IRS recommends they wait until additional guidance is available or consult with a reputable tax professional. For taxpayers and tax preparers with questions, the best course of action is to wait for additional clarification on state payments rather than calling the IRS. We also do not recommend amending a previously filed 2022 return.

January 17 update

January 23 is the official start to 2023 tax filing season; more help available for taxpayers this year

IRS has announced Monday, January 23, 2023, as the beginning of the nation's 2023 tax season when the agency will begin accepting and processing 2022 tax year returns.

With the three previous tax seasons dramatically impacted by the pandemic, the IRS has taken additional steps for 2023 to improve service for taxpayers. As part of the August passage of the Inflation Reduction Act, the IRS has hired more than 5,000 new telephone assistors and added more in-person staff to help support taxpayers.

IRS completes automatic corrections of tax year 2020 accounts related to unemployment compensation exclusion; 12 million refunds issued

The IRS recently completed the final corrections of tax year 2020 accounts for taxpayers who overpaid their taxes on unemployment compensation they received in 2020.

The American Rescue Plan Act of 2021, which became law in March 2021, excluded up to $10,200 in 2020 unemployment compensation from taxable income calculations (up to $10,200 for each spouse if married filing joint). The exclusion applied to individuals and married couples whose modified adjusted gross income was less than $150,000.

To ease the burden on taxpayers, the IRS took steps to review the Forms 1040 and 1040-SR that were filed prior to the law's enactment to identify taxpayers who had already reported unemployment compensation as income and were eligible for the correction. The IRS determined the correct taxable amount of unemployment compensation and tax.

California storm victims qualify for tax relief; April 18 deadline, other dates extended to May 15

California storm victims now have until May 15, 2023, to file various federal individual and business tax returns and make tax payments.

The IRS is offering relief to any area designated by the Federal Emergency Management Agency (FEMA). The current list of eligible localities is always available on the Tax Relief in Disaster Situations webpage.

The tax relief postpones various tax filing and payment deadlines that occurred starting on January 8, 2023. As a result, affected individuals and businesses will have until May 15, 2023, to file returns and pay any taxes that were originally due during this period.

January 6 update

IRS releases FAQs about clean vehicle credits for new, previously owned and commercial clean vehicles

IRS has issued frequently asked questions (FAQs) about clean vehicle credits for new, previously owned and commercial clean vehicles.

The Inflation Reduction Act of 2022 (IRA) made several changes to the new clean vehicle credit for qualified plug-in electric drive motor vehicles, including adding fuel cell vehicles. The IRA also added a new credit for previously owned and commercial clean vehicles.

These FAQs provide details on how the IRA revises the new clean vehicle credit for individuals and businesses, information on the previously owned clean vehicle credit for individuals and the new credit for qualified commercial clean vehicles.

IRS issues frequently asked questions about energy credits

IRS has issued FAQs about energy efficient home improvements and residential clean energy property credits.

The inflation Reduction Act of 2022 (IRA) amended the credits for energy efficient home improvements and residential energy property. These FAQs provide details on the IRA's changes to these tax credits, information on eligible expenditures, and provides examples of how the credit limitations work.

IRS updates frequently asked questions about Form 1099-K

The IRS issued a news release and updated frequently asked questions (FAQs) for Form 1099-K, Payment Card and Third Party Network Transactions, in Fact Sheet FS-2022-41PDF.

On December 23, 2022, the IRS announced that calendar year 2022 will be treated as a transition year for the reduced reporting threshold of more than $600. For calendar year 2022, third-party settlement organizations who issue Forms 1099-K are only required to report transactions where gross payments exceed $20,000 and there are more than 200 transactions.

IRS issues standard mileage rates for 2023

The IRS issued the 2023 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.

Beginning on January 1, 2023, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

  • 65.5 cents per mile driven for business use, up 3 cents from the midyear increase setting the rate for the second half of 2022.
  • 22 cents per mile driven for medical or moving purposes for qualified active-duty members of the Armed Forces, consistent with the increased midyear rate set for the second half of 2022.
  • 14 cents per mile driven in service of charitable organizations; the rate is set by statute and remains unchanged from 2022.

These rates apply to electric and hybrid-electric automobiles, as well as gasoline and diesel-powered vehicles.

November 18 update

IRS hiring over 700 employees to help taxpayers in person

In addition to the more than 4,000 people recently hired to fill critical customer service representative positions, the IRS is now seeking over 700 new employees to help taxpayers at Taxpayer Assistance Centers across the country.

This increase in staffing is part of much wider IRS improvements enabled by the Inflation Reduction Act funding approved in August 2022, and additional updates on the implementation of the landmark 10-year legislation will be provided soon.

The IRS continues to host numerous virtual and in-person recruitment events each month. These information sessions and job fairs provide insight about the positions that are available. For more information and to register for an event, see IRS Events.

October 27 update

Taxpayers in declared disaster areas get more time for COVID penalty relief

Taxpayers in areas covered by certain Federal Emergency Management Agency (FEMA) disaster declarations have more time to file their returns to qualify for the penalty relief under Notice 2022-36 for their 2019 and 2020 tax returns.

Tax inflation adjustments for tax year 2023

The IRS announced the tax year 2023 annual inflation adjustments for more than 60 tax provisions, including the tax rate schedules and other tax changes. Revenue Procedure 2022-38 provides details about these annual adjustments.

October 14 update

IRS sent letters to individuals and families that did not claim key tax benefits

The IRS sent letters to more than 9 million individuals and families who appear to qualify for a variety of key tax benefits but did not claim them by filing a 2021 federal income tax return. Many in this group may be eligible to claim some or all of the 2021 Recovery Rebate Credit, the Child Tax Credit, the Earned Income Tax Credit and other tax credits depending on their personal and family situation.

October 6 update

Tax relief for Hurricane Ian victims in North Carolina and South Carolina

Hurricane Ian victims throughout North Carolina and South Carolina qualify for tax relief and now have until February 15, 2023, to file various federal individual and business tax returns and make tax payments.

October 4 update

Tax relief for Hurricane Ian victims in Florida

Hurricane Ian victims throughout Florida qualify for tax relief and now have until February 15, 2023, to file various federal individual and business tax returns and make tax payments.

September 21 update

Improperly forgiven Paycheck Protection Program loans are taxable

IRS issued guidancePDF addressing improper forgiveness of a Paycheck Protection Program loan (PPP loan). The guidance confirms that, when a taxpayer's loan is forgiven based upon misrepresentations or omissions, the taxpayer is not eligible to exclude the forgiveness from income and must include in income the portion of the loan proceeds that were forgiven based upon misrepresentations or omissions.

Taxpayers who inappropriately received forgiveness of their PPP loans are encouraged to take steps to come into compliance by, for example, filing amended returns that include forgiven loan proceed amounts in income.

Tax relief for Hurricane Fiona victims in Puerto Rico

Hurricane Fiona victims in all 78 Puerto Rican municipalities qualify for tax relief and now have until February 15, 2023, to file various federal individual and business tax returns and make tax payments.

September 13 update

IRS issues rules for alternative fuel credits

The IRS issued Notice 2022-39, which provides rules to make a one-time claim for the credit and payment allowable for alternative fuels sold or used during the first, second, and third calendar quarters of 2022. It also provides instructions for how a taxpayer's liability for excise tax may be reduced by claiming the alternative fuel mixture credit allowable for the first and second quarters of 2022. The alternative fuel credits are part of the Inflation Reduction Act.

September 2 update

The IRS takes immediate steps to address issue with a subset of Forms 990-T

The IRS recently discovered that some machine-readable (XML) Form 990-T data made available for bulk download section on the Tax Exempt Organization Search (TEOS) should not have been made public. This section is primarily used by those with the ability to use machine-readable data; other more widely used sections of TEOS are unaffected.

The IRS took immediate steps to address this issue. The files have been removed from IRS.gov and will be replaced with updated files in the near future. In addition, the IRS also will be working with groups that routinely use the files to remove the erroneous files and replace them with the correct versions as they become available. The IRS will contact all impacted filers in the coming weeks. For more information see the IRS statement.

May 6 update

IRS provides guidance for residents of Puerto Rico to claim the Child Tax Credit

The Internal Revenue Service has issued guidance for certain individuals in Puerto Rico on how to file and claim the Child Tax Credit payments that they are entitled to receive under the American Rescue Plan Act. Families who don't owe taxes to the IRS can file their 2021 tax return and claim the Child Tax Credit for the 2021 tax year at any point until April 15, 2025, without any penalty.

February 14 update

IRS suspends more than a dozen automated notices, including collection issues

As part of ongoing efforts to provide additional help for people during this period, the IRS has suspended automated collection notices normally issued when a taxpayer owes additional tax or has no record of filing a tax return. Note that many other IRS notices are statutorily required to be issued within a certain timeframe to be legally valid. The IRS encourages those who have a filing requirement and have yet to file a prior year tax return or to pay any tax due to promptly do so as interest and penalties will continue to accrue. Visit IRS.gov for payment options. For more information on suspended notices, see IR-2022-31, IRS continues work to help taxpayers; suspends mailing of additional letters.

General information for the 2023 tax season

April 18 tax deadline

The due date is April 18, instead of April 15, because of the Emancipation Day holiday in the District of Columbia—even if you don't live in the District of Columbia.

Child Tax Credit

Families who don't owe taxes to the IRS can still file their 2021 tax return and claim the Child Tax Credit for the 2021 tax year at any point until April 15, 2025, without any penalty. This year also marks the first time in history that many families with children in Puerto Rico will be eligible to claim the Child Tax Credit, which has been expanded to provide up to $3,600 per child.

More people may be eligible for the Premium Tax Credit

For tax year 2022, taxpayers may qualify for temporarily expanded eligibility for the Premium Tax Credit. Remember that simply meeting the income requirements does not mean you're eligible for the premium tax credit. You must also meet the other eligibility criteria.

Status of IRS tax return inventory from prior years

COVID-19 continues to cause delays in the processing of some prior year tax returns and amended returns. Please visit our IRS Operations During COVID-19: Mission-critical functions continue page to find out the current status of the IRS inventory from prior years.