Potential for Larger Tax Refunds as IRS Updates Reflect Economic Realities
Wage Stagnation Leads to Potential 10% Increase in Tax Refunds for Some Workers
According to Market Realist, the IRS has made adjustments to tax brackets and deductions for 2024 to reflect the increasing cost of living. This means that many individuals could see larger tax refunds this year especially if their incomes have not risen much. On average, tax refunds have increased by 2.1% compared to last year with some workers potentially getting up to 10% more due to wage increases not keeping up with inflation.
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2024 Tax Brackets: Bigger Refunds Await Taxpayers! (PHOTO: getty images)
Proposed Tax Relief Measures Could Boost Refunds in Coming Years
These adjustments come after a decline in refunds in 2023 when pandemic related tax benefits expired. However new tax credits introduced in 2023 like those for energy efficient home upgrades and clean vehicle purchases and could lead to higher refunds for eligible individuals. There are also proposed tax measures like the Tax Relief for American Families and Workers Act of 2024 that aim to enhance tax credits further potentially resulting in larger refunds in the future. Despite these changes some taxpayers may owe more this year especially if they did not pay quarterly self employment taxes for side gigs or have teenage children who no longer qualify for certain tax credits.
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