Tax season 2024 brings shifts that directly affect household finances, particularly for e-commerce sellers and electric vehicle buyers.
The IRS expanded reporting requirements for third-party payment processors like PayPal, Stripe, and Square. These platforms now must file Form 1099-K for transactions exceeding $5,000, down from the previous $20,000 threshold. This change tightens scrutiny on side gigs and small online businesses, forcing more Americans to report income they might have previously underreported. Sellers on Amazon, Etsy, and other marketplaces face heightened audit risk if their filings don't align with processor reports.
The electric vehicle tax credit remains available but with revised income caps. Single filers earning over $300,000 and married couples exceeding $600,000 lose eligibility for the full $7,500 credit on new EV purchases. Used EV buyers benefit from a separate $4,000 credit with even tighter income thresholds. The credit now applies at the point of sale rather than at tax filing, simplifying the process but requiring buyers to verify their status at dealerships.
Home office deductions expanded for self-employed workers. The simplified option now covers $5 per square foot of dedicated workspace, up from prior limits. Freelancers, consultants, and remote business owners can claim larger deductions without itemizing expenses.
Child tax credits remain at $2,000 per child, but eligibility windows narrowed slightly for higher-income households. Dependent care expenses and education savings accounts offer continued breaks for families managing childcare costs.
For retirees, required minimum distribution rules shift slightly for those over 73, with updated life expectancy tables reducing mandatory withdrawal percentages. This benefits retirees by lowering taxable income.
Online sellers should gather all 1099-K documents immediately and