{"id":1017,"date":"2024-02-09T14:50:38","date_gmt":"2024-02-09T19:50:38","guid":{"rendered":"https:\/\/senatedems.com\/singh\/?p=1017"},"modified":"2024-02-22T13:47:27","modified_gmt":"2024-02-22T18:47:27","slug":"tax-tips-newsletter","status":"publish","type":"post","link":"https:\/\/dev.senatedems.com\/singh\/2024\/02\/09\/tax-tips-newsletter\/","title":{"rendered":"Tax Tips Newsletter"},"content":{"rendered":"

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Dear Neighbor,
It continues to be an honor serving you in the State Senate, and I look forward to all this New Year holds \u2014 the many conversations with constituents, movement on important legislation, exciting events around District 28 and more.<\/p>\n

The new year also means tax season is upon us \u2014 this year, however, differs a great deal from previous ones as it is the first year Michigan families and seniors can take advantage of historic tax relief passed by Senate Democrats last March.<\/p>\n

As you work to file your federal and state income taxes \u2014 due by April 15, 2024 \u2014 I hope you find the information
contained in this newsletter helpful in maximizing your return. Please know my office is available to assist you as you work through this process.<\/p>\n

As always, should you ever need assistance communicating with the Treasury department or any other state agency throughout the year, please do not hesitate to reach out to me and my office \u2014 we are here to serve you. You can contact me toll-free at (855) 347-8028<\/strong>, by email at SenSSinghsenate.michigan.gov<\/a> or through my website online at SenatorSingh.com<\/a>.<\/p>\n

Sincerely,<\/p>\n

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Sam Singh
<\/strong>State Senator
District 28<\/p>\n

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Lowering MI Costs <\/strong>
Rising costs, high fuel prices and supply chain issues are making it harder for families to put food on the table and fill up their gas tank. To help change this reality, Senate Democrats finalized the Lowering MI Costs Plan last March \u2014 the biggest tax relief initiative Michigan has seen in decades. The plan overhauls the unfair and unpopular retirement tax and expands the Working Families Tax Credit, helping more Michigan families and seniors save money.<\/p>\n

Expanding the Working Families Tax Credit<\/strong>
To help alleviate financial hardship for families, Senate Democrats created the Working Families Tax Credit, which increases the state\u2019s current federal match for the Earned Income Tax Credit (EITC) from 6% to 30%. Public Act 4 of 2023 will help 700,000 Michiganders who have the hardest time affording the basics save an average of $3,150 per year. The expansion takes effect on February 13, 2024. To qualify for the Michigan EITC, you must already qualify for the federal credit.<\/p>\n

In addition to claiming it this tax season, the expanded Michigan EITC is also retroactive to the 2022 tax year (last tax season). Federally eligible individuals who claimed the Michigan EITC on their 2022 taxes received the original 6% credit. After the expansion takes effect, the Michigan Department of Treasury will begin to issue supplemental check payments over a period of 5-6 weeks, to provide eligible taxpayers with the remaining 24% portion of the credit. The Michigan Department of Treasury encourages residents to stay up to date and verify their eligibility at Michigan.gov\/taxes<\/a>.<\/p>\n

Repealing the Retirement Tax <\/strong>
Ending the tax on retirees has been a top priority for Democrats for more than a decade. Public Act 4 of 2023 phases out the unfair and unpopular retirement tax over four years, and will put an average of $1,000 back in the pockets of 500,000 households. This legislation provides targeted and equitable relief for retirees, restoring the broken promise of a safe, secure and happy retirement for Michiganders.<\/p>\n

Public police officers and firefighters, county correction officers, state troopers and sergeants will receive the full exemption beginning on February 13, 2024. Michiganders from other professions will have the option to choose the best taxing situation for their retirement benefits, by opting into either the tier structure subtraction or phase-in subtraction until the full repeal takes effect in 2026. You may wish to consult with a qualified tax preparer to ensure you are able to deduct the maximum amount of retirement benefits.<\/p>\n

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Free Credit Report<\/h3>\n

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Access your free report at: AnnualCreditReport.com<\/a><\/p>\n

Michigan Attorney General Dana Nessel is reminding residents that they can access free weekly credit reports from each of the three main credit reporting agencies: Equifax, Experian and TransUnion. The program was initiated in 2020 after the pandemic put many people\u2019s finances in dire straits. After two extensions, the program is now permanent.<\/p>\n

Credit reports contain the financial and personal data used by businesses and potential creditors to assess an individual\u2019s financial fitness for rentals, house and vehicle financing, insurance or even a job. The approval of your application could be impacted by inaccurate information, and it benefits residents to be knowledgeable about what is in their credit report.<\/p>\n

The free weekly credit report can be accessed from AnnualCreditReport.com<\/a>, the only official site for free credit reports authorized by federal law. Other sites offer free credit reports, though residents should exercise caution and watch for fraudulent sites designed to steal
your money or your personal information.<\/p>\n

To make a formal complaint, call the Attorney General’s Consumer Protection Division at (517)-335-7599<\/strong>.<\/p>\n

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Tax season is here, so it\u2019s time to get out your tax documents and file with the state and federal governments before the
national deadline on Monday, April 15, 2024. Here are tips on how to take advantage of some of the most common tax
deductions while staying clear of common scams that target people during the early parts of the year.<\/p>\n

For federal returns, the IRS\u2019 official website is IRS.gov<\/a>, and they will only reach out to you through regular mail delivered by
the U.S. Postal Service. The Michigan Department of Treasury\u2019s official website is Michigan.gov\/treasury<\/a>, but they also have
a dedicated tax page at Michigan.gov\/taxes<\/a>. Visit IRS.gov<\/a> for more information and to learn additional ways to protect
yourself from tax scams.<\/p>\n

Charitable Contributions <\/strong>
In most cases, you can claim the full amount you give to an IRS-qualified organization as an itemized deduction on your federal taxes. Since 2012, however, credits for certain donations are no longer available on your Michigan tax return. Be sure to check with IRS.gov<\/a> or your tax preparer, if applicable.<\/p>\n

Home Ownership<\/strong>
Costs such as property taxes and points paid to get a lower home loan interest rate are deductible, as is interest on home equity loans up to a certain threshold. Your deduction is generally limited if all mortgages used to buy, construct or improve your first home (and second home, if applicable) total $750,000. Mortgages that existed before December 14, 2017, will continue to receive the same tax treatment as under the old rules.<\/p>\n

Medical Expenses and Other Deductions<\/strong>
Medical costs \u2014 including costs associated with preventative care, surgeries, dental, vision, psychologist visits, hearing aids and more \u2014 that exceed 7.5% of your federal adjusted gross income may be claimed on your taxes. Be sure to include them as itemized deductions. You may also qualify for deductions from student loan interest, child and dependent care, mortgage interest and more.<\/p>\n

Small Business Expenses <\/strong>
Generally, most types of business insurance, the cost of utilities, rent payments, expenses related to the purchase and upkeep of company-owned vehicles, office supplies and furniture are all tax deductible.<\/p>\n

Visit IRS.gov\/credits-deductions\/businesses<\/a> for more details.<\/p>\n

Veterans and Their Families <\/strong>
Nearly 568,000 veterans call Michigan home. So many put their life on the line \u2014 sacrificing their comfort and safety \u2014 to defend our ideals of liberty and democracy. After their service to our state and nation, it\u2019s our responsibility to ensure they have the benefits they deserve. A 2023 reform requires a property tax exemption on real property used and owned as a homestead by a disabled veteran \u2014 or a veteran\u2019s surviving spouse \u2014 to remain in effect, until rescinded by the individual granted the exemption or denied by the assessor.<\/p>\n

Understand Refund Timing<\/strong>
The IRS processed more than 90 million tax returns last year. Nevertheless, they are very efficient at turning returns and payments around in 21 days for those who file electronically. If you mail in a paper return, the IRS has warned it can take as long as six months or more to process. However you file, you can check the status of your refund through the \u201cWhere\u2019s My Refund?\u201d page on the IRS website.<\/p>\n

Visit IRS.gov\/refunds<\/a> for more details<\/p>\n

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Clean Energy Provisions in the Federal Inflation <\/strong>Reduction Act<\/strong>
In August 2022, President Joe Biden signed the federal Inflation Reduction Act into law, which includes nearly two dozen tax provisions designed to save families money on their tax and energy bills, while accelerating the deployment of clean energy, clean vehicles, clean buildings and clean manufacturing. As you file your 2024 taxes, keep deductible items in mind.<\/p>\n

Home Clean Electricity Improvements<\/strong>
If you made qualified energy-efficient improvements to your home after Jan. 1, 2023, you may qualify for a tax credit up to $3,200. Some of the qualified improvements include:<\/p>\n