Tax News and Updates for 2022

INDIVIDUAL HIGHLIGHTS FOR 2022

  • Standard Deductions have increased, meaning many Taxpayers will NOT benefit by itemizing. MN did not adopt the Federal amounts, they are slightly lower. However if you are unsure, please include the information and we will look at this for you.

  • The Medical Mileage Rate was split during the year.

    January 1 - June 30 the rate is 18 cents; July 1 - December 31 the rate is 22 cents

  • The Mortgage Insurance Premium deduction was not extended as of this letter.

  • The additional $600/$300 charitable donation deduction above the Standard deduction was not extended as of this letter.

  • If you had MNSure (marketplace Health Ins.) Form 1095A is required; you’ll receive this in January.

  • Crypto-currency transactions (digital wallets) may be taxable income. Virtual Currency and Foreign Accounts must be reported on your return. The IRS is targeting these transactions more frequently.

  • The Child Tax Credit (CTC) is back to $2000 per child with some limits for income and refundable amounts.

  • Child care (daycare) expenses are no longer refundable and have returned to the credit based on spending $3,000 per child up to two children for a max total of $6,000; you will then receive a percentage based on your income. This is the same credit in all past years aside from 2021.

  • Frontline Worker Pay (Hero Pay) was approved by MN to be paid in 2022 for $487.45. Because it is under the $600.00 threshold it is unlikely a 1099 will be issued. HOWEVER, this income IS taxable on your Federal return. Please be sure to include this information if you received this income.

BUSINESS HIGHLIGHTS FOR 2022:

  • Qualified Business Income Deduction (QBI or Section 199A): Taxpayers (other than C Corps) can deduct up to 20% of QBI. For the most part - we see this as a great tax savings!

  • Business Meals will now be 100% deductible for 2021 & 2022.  Entertainment is not deductible.

  • Business mileage rate was split during the year:

    January 1 - June 30 the rate is 58.5 cents; July 1 - December 31 the rate is 62.5 cents

    PLEASE MAKE SURE YOUR MILEAGE IS SPLIT FOR THESE DATES. (Remember logs are required).

Other Notables:

  • Beginning January 1, 2023; social security (FICA) wage limit increases to $160,200.00.

  • Remember, Partnership tax returns and “S” Corporations are DUE MARCH 15 th .


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(“Mom Pop” to Multimillion dollar businesses use our system.)  It covers but not limited to:

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Other Notables:

  • Beginning January 1, 2022; social security (FICA) wage limit increases to $147,000.00.

  • Remember, Partnership tax returns and “S” Corporations are DUE MARCH 15th.

  • All Corporations need Board Minutes, Meetings & Loan Documents up to date.

  • IRS notices have changed & have stricter response dates - we need to review these timely. 


BEWARE OF TAX SCAMS

The IRS warns taxpayers to be on the lookout for an array of evolving tax scams related to identity theft and refund fraud.  The first point of contact by the IRS is typically via U.S. Mail, NOT a PHONE CALL!  Although it has been reported that fake notices are now being used and sent in the mail as well.  It is ALWAYS a good idea to consult us if you receive a notice.  We are here to help you.  In addition, the IRS does not use email, text messaging or any social media to discuss your tax issues.