Five things to remember while filing income tax return

The IRS opened tax season on Jan. 23. The deadline for individuals to file an income tax return is April 18. The tax agency expects more than 168 million federal returns to be filed this season. Here are some things to know about filing your 2022 income taxes, like how to file for free and get a faster refund.


Income tax refund timing and amount

In most cases, you should get a refund within 21 days. To prevent delays, file an electronic, error-free tax return with payments made by direct transfer. Sending a paper return or requesting a refund check is not acceptable.

Check your return for important facts and fundamental errors, like typos in your name, address, date of birth, banking information, and Social Security number. Errors might cause reimbursements to be delayed.

The IRS has issued a warning that tax refunds may be reduced this year. Tax breaks from the Pandemic Era, including increases to the child tax credit, child and dependent care credit, and earned income tax credit, are no longer accessible.

Filing — and maybe income tax assistance — may be free

When filing a return, certain taxpayers can make use of free (and frequently underutilized) services.

Online tax preparation is free and directed by the IRS Free File program. Taxpayers with an annual adjusted gross income of $73,000 or less are eligible for the program, which is provided through a public-private partnership.

70% of taxpayers have access to Free File, but few do so, and others may unintentionally pay to file a return.

Fillable Forms, which are electronic federal tax forms that you may complete and submit for free online through the IRS, are also available. For DIYers, it practically amounts to a pencil and paper choice.

You may also be qualified for free tax assistance at a local Volunteer Income Tax Assistance Center if you have an income of $60,000 or less, have a disability, or speak limited English. People 60 and older may also receive assistance through Tax Counseling for the Elderly.

When should you file your tax return?

Most of the time, you should file as quickly as you can to obtain a quicker return and lessen the chance that an identity thief may use your information to make a refund claim in your name.

However, you must file all necessary tax forms, which may not be accessible yet. You may get an idea of what paperwork you might require by looking at last year’s tax return. They may be mailed to you or made available to you online. (In addition to tax forms, have receipts for appropriate tax deductions and credits on hand.)

If you owe taxes and are concerned about not having the money to pay them right now, you may postpone filing your return until April 18. To avoid penalties, file a return and pay at least a portion of your amount.

What Should You Do With Your Tax Refund?

This year, it may be prudent to save rather than spend your tax refund. In an unpredictable economic situation, having a larger financial buffer is critical. Taxpayers may earn 3% to 4% on that money by using an online bank that offers a high-yield savings account. They could also choose to set up a pre-tax or Roth individual retirement account.

Improved client service

Those with tax questions may have a more pleasant encounter with the IRS this year than in the past. The Inflation Reduction Act increased funds for the agency, which has begun implementing improvements such as recruiting 5,000 more customer support representatives and implementing new technology that allows consumers to react to some alerts online. Only 13% of customers who called in last year reached a representative. The IRS intends to reduce phone hold times to 15 minutes.

visit our Finance section here.

About The Author

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Posts