(WKBN) — Tax changes are beginning in the new year that will affect the child tax credit as well as third-party payment networks.
The pandemic caused multiple changes to the child tax credit, like people receiving monthly payments as well as expanded credit for children under the age of 6.
Michael Flugher from Tax Check said that all ends in 2022.
“The recent situation in congress, they haven’t passed an extension yet. So, we will be receiving a form at the end of this year or early next year,” he said.
That form is Letter 6419. It will help avoid mistakes reconciling your child tax credit.
At this time, monthly advance payments will stop and credit for children will return to $2000 per child under age 6 and amounts will be once again be scaled based on income.
However, things could change if Congress decides to extend their help.
“That has ended as of December 15, but probably something will happen,” Flugher said.
The child tax credit isn’t the only thing you’ll want to look out for with taxes this year, tax changes are also coming to apps like PayPal, Venmo, and Cash App.
This mainly affects small businesses using these payment networks.
Currently, you get a form 1099k if you receive more than $20,000 in gross payments and make 200 separate payments in a year.
Flugher said that all changes for the IRS after this tax season.
“They will reduce that limit down to $600 and I saw no limit on the number of transactions,” he said.
All income is taxable whether or not you receive a form W2 or 1099, unless some exception applies.