LOCAL BUSINESS OWNERS MAY STILL HAVE TAX OBLIGATIONS INTO THE SUMMER

by Kate Gassman
Editor

BUCHANAN, MI – While the filing date has passed, tax season may drag on for many Berrien County businesses. Some still have tax extensions to meet and payment plans to arrange, along with letters from the IRS asking for further documentation and other clarification. Changes for this year include digital updates for the ongoing Inflation Reduction Act, mileage changes, and revised Beneficial Ownership requirements for small business owners.
In 2022, Congress passed the Inflation Reduction Act, to help reduce federal budget deficit and reduce prescription drug prices. More on the Act can be found on this one-page resource. The plan will be enacted over 10 years, but for the 2024 tax season, the IRS continued to make significant improvement to help taxpayers. They extended hours at 242 locations around the country, specifically to help rural locations get help filing. They also replaced older digital scanning equipment and enabled mobile filing, increasing digital accessibility and correspondence for 94% of taxpayers. On their 2-year report card, the IRS detailed several other improvements implemented over the first 2 years of the plan, with updates on coming changes.
New for the 2024 tax season (with filing deadline April 15, 2025), taxpayers who received over $5000 in payments from third-party apps like PayPal should have received a 1099-K in January. The standard mileage rate was increased to $0.67/mile for business use. This also applies to vans, panel trucks, and pickup trucks. For next year (the 2025 tax season, with filing deadline April 15, 2026), the business use mileage rate will increase a further $0.03/mile, bringing it to $0.70.
One significant update that small business owners may have had on their radar was the BOI, or Beneficial Ownership Information report. The 2021 Corporate Transparency Act was set to require anyone with more than 25% holding in a company to file a report, providing trademarks, legal name, address, and other information. However, in March, the U.S. Treasury changed that requirement, removing the requirements for U.S. companies and persons. Instead, only foreign companies will have to comply. Local businesses that received the letter requesting the BOI may disregard. More information can be found on the Financial Crimes Enforcement Network (FINCEN) website here.
To find out more about this year’s IRS changes and updates, visit their tax news page.