Monday (27) marks the first day the IRS will begin accepting and processing income tax returns for 2024.
So, if you’re in a hurry to receive your refund or just wondering how long you can delay filing your return, here’s what you need to know and some tips to make your taxes a little easier.
The Filing Deadline
The official deadline for filing and payment to the IRS this year is April 15, unless you:
Live in a federally declared disaster area: for residents and businesses in these areas, the IRS typically grants extensions for filing and payment of income taxes, as well as any other federal tax obligations you may have during a given period. For example, the IRS postponed the filing and payment deadlines for taxes to October 15 for those in counties affected by wildfires in the Los Angeles area.
Cannot or do not want to file by April 15: this is acceptable as long as you request an automatic six-month extension by that date. This type of extension, however, is simply an extension to file your 2024 return, but not an extension to pay what you owe. If you owe any money to the IRS for the 2024 tax year, April 15 is still your payment deadline.
Find Out If You Can File for Free
The IRS Direct File program, which allows qualified taxpayers to file their taxes directly with the IRS for free, is now available in 25 states.
The states are: Alaska, Arizona, California, Connecticut, Florida, Idaho, Illinois, Kansas, Maine, Maryland, Massachusetts, Nevada, New Jersey, New Hampshire, New Mexico, New York, North Carolina, Oregon, Pennsylvania, South Dakota, Tennessee, Texas, Washington State, Wisconsin, and Wyoming.
Additionally, the IRS is partnering with certain private tax preparation software companies that will allow you to file for free if you qualify. Generally, it is only for filers whose adjusted gross income is $84,000 or less. Furthermore, each of the private partners has its own eligibility criteria based on factors such as age, income, and residency.
Review Your 2023 Tax Return
Your return from the previous year will give you a good starting point to figure out what documents you need to have on hand to fill out your 2024 return.
List Major Changes That Happened in 2024
Did you get married or divorced? Have a child? Start a side job to earn more income? Sell a house or another major investment? Start receiving Social Security or inherit IRA payments? Lose a job and receive unemployment benefits?
Major life transitions and income changes can have a direct effect on your tax obligation — including any tax exemptions you may have and the size of your refund — or the amount of additional tax you may owe.
Gather All Your 2024 Tax Documents
While you may receive paper versions of your 2024 tax documents, others may only be delivered electronically. Therefore, check your mailbox, email, and relevant online accounts to ensure you have received all W2s, 1099s, donation receipts, and any other income tax information forms you will need from your banks, brokerages, employers, favorite charities, etc.
Be Aware of New 1099-K Forms
If you were paid for goods and services you provided through payment apps or online marketplaces like Venmo, CashApp, Airbnb, and Etsy, you may receive a 1099-K reporting your transactions if, combined, they exceeded $5,000 for the year. (The old threshold used to be $20,000.)
You may also receive a 1099-K if those combined transactions are less than that, especially if you live in Maryland, Massachusetts, Vermont, or Virginia, where the reporting threshold is set at $600.
If you receive a 1099-K by mistake — for example, if the form includes personal transactions — consult the IRS on how to correct the situation.
But generally speaking, the IRS expects you to report all the information from the 1099-K you receive on your 2024 return. Then, make the necessary adjustments to correct any errors on the return using Schedule 1 or through a corrected return after you have submitted the original by the filing deadline.
What to Know About Your Potential Refund
The only real reason most people are anxious to file their return is if they are entitled to a refund.
Most U.S. taxpayers typically receive a refund, which the IRS usually issues within 21 days after receiving the return. To track the status of your refund, you can use the agency’s Where’s My Refund tool.
Source: CNN