Changes for the 2024 Tax Year to Look out for

There is a surplus of tax changes to account for as both individuals and businesses alike plan for the 2024 tax year ahead. Some of these changes are new laws and others are provisions of older laws that are finally going into effect. The following are a few important changes to take note of:

1.    The Health Saving Account (HSA) contribution limit has increased to $4,150 for individuals and $8,300 for families.

2.    First-year bonus depreciation is decreasing from 80% to 60%.

3.    The cash method of accounting can be used by C-Corporations whose average annual gross receipts are $30 million or less for the past three years.

4.    The annual gift tax exclusion is $18,00 per person and $36,000 if the person’s spouse agrees. If this amount is exceeded during the year, a gift tax return must be filed for 2024.

5.    Owners of a Roth 401(k) are no longer required to take a minimum distribution.

6.    Workplace retirement plans can offer student loan relief through 401(k) matches that are based on the employee making student loan repayments.

7.    Standard deductions for those filing single or married filing separately are increased to $14,600. For those who are married filing jointly or surviving spouses will have a standard deduction of $29,200. The standard deduction for those filing as head of household is $21,900.

These are only a few of the applicable changes to be considered throughout the 2024 tax year. The key to being prepared is to stay informed and plan accordingly. Be on the lookout for future updates and other key changes.