WICHITA, Kan (KSNW) — Tax season begins Monday, Jan. 23, and there are a few things that may look different.
One big difference this year is the child tax credit. Last year, you would’ve received either $3,000 or $3,600, depending on their age. This year, it’s back down to $2,000 per qualifying child as it was before the pandemic.
When it comes to spending, experts expect a reset following a year of high prices and inflation.
Bonnie Powell is the vice president at All American Accounting West. She says while you may see a little less on your return, things will be a little easier on each side of the desk because you don’t have to keep track of as much such as stimulus money.
“You don’t have to keep track of that paperwork,” Powell said. “And we don’t have to ask you those questions. So you’re not going through your bank statement trying to figure out when did I get it? Did I get the stimulus payment?”
The director of the Center for Economic Development and Business Research at Wichita State University, Jeremy Hill, expects households to spend their return in different ways after a smaller return and inflation.
Hill expects low-income households to pay off debt.
For low-middle income houses, he expects they might build up savings or use it as a down payment.
“Trying to get that next house, but they got a little nervous and didn’t buy the house,” Hill said. “They could be either build up their savings that got depleted over this last year.”
For upper-middle and higher-income households, he expects them to spend it.
“Very likely, since they’re not really hurt, their savings are fine. They’re going to finally get to that spending that they wanted,” Hill said.
To make sure you get the correct return, Powell encourages having a conversation with a tax professional because things can come up that you didn’t even know about, and one mistake can cost you a lot of money. Also, she says to make sure to have everything ready when you go so you don’t have to amend a return.
“Taking advantage of a tax code isn’t cheating, you just want to make sure you get the most benefit that you can for anything you’re eligible for,” Powell said.
When it comes to state taxes, she says to remember Kansas will let you itemize at the state level even if you don’t at the federal level.
Powell says in the past, Kansas typically gets their returns issued within a week.
For the IRS, she’s unsure what the schedule will look like at this point, but she advises not to spend your return until it’s in your bank.
Tax day is April 18.