Americans can officially start filing their 2022 individual income tax returns on Monday.
“This tax filing season marks the first to benefit the IRS and our nation’s tax system with multi-year funding in the Reduced Inflation Act,” Acting IRS Commissioner Doug O’Donnell said in a statement. “We have trained thousands of new employees to answer phones and help people. While there is still a lot of work to do after several difficult years, we expect people to see improvements this tax season.”
This is everything taxpayers need to know:
When is the deadline to file taxes?
Most taxpayers will have until Tuesday, April 18 to file their returns or request an extension. That’s because April 15, the typical deadline, falls on a Saturday, and April 17 is the Emancipation Day holiday in Washington, where the IRS is headquartered.
How do I request an individual tax extension?
If you are an individual, you can request an extension online by completing Form 4868 using the “”Free File” tool. You must submit the form by April 18 or print and mail it to the IRS address for your state, making sure it is postmarked by April 18. Once you file the extension, you have until October 16, 2023 to file your taxes.
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However, there are pros and cons to requesting an extension.
You can give taxpayers more time to thoroughly review their return and take advantage of all the tax benefits, such as various deductions and credits, that are available to help them reduce liability.
By delaying the filing date, you can also avoid a no-filing penalty: an additional 5% per month on the unpaid amount, which can add up to 25% of the tax due. If you request an extension, you have until October 16 before the penalty begins to accrue.
Experts caution that requesting an extension does not mean you can delay paying the government any taxes you owe.
“The extension to file is not an extension to pay,” Eric Bronnenkant, head of tax at online financial adviser Betterment, previously told FOX Business. “A common misconception is that you have more time to pay, and that’s not true.”
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How can I get my tax refund as soon as possible?
Most taxpayers can normally expect to receive a refund from Uncle Sam. For many families, the money can be substantial: Nearly three-quarters of taxpayers received a tax refund in 2022, with an average payment of about $3,176, up from $2,800 in 2021.
In order to receive your refund within 21 days of filing, the IRS warned you to file your return electronically, make sure it is accurate and complete, and request to receive your refund via direct deposit.
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However, the tax agency warned that some returns may require “additional review” and take longer to process if their systems identify any errors; if there are errors in the statement; or if you suspect theft or fraud.
“Filing a paper return is probably the worst idea of all, even though the IRS has hired additional staff,” Tom O’Saben, director of tax content and government relations for the National Association of Tax Professionals, told FOX Business. . “They’re still dealing with a buildup from last year. The difference would be measured in months, rather than weeks if someone filed a paper return instead of an electronic filing.”
What if I expect to receive the child tax credit or the earned income tax credit?
The IRS warns of a problem for early filers hoping to collect the earned income tax credit, a tax break for low- and moderate-income workers or an additional child tax credit.
If you claim any of the tax credits, the IRS cannot issue your refund before mid-February.
The IRS warned that refunds could be smaller this year. Why?
The agency previously warned taxpayers to prepare for smaller refunds this year because the federal government did not deliver stimulus payments in 2022. In 2021, the IRS delivered a third round of stimulus payments worth up to $1,400 per person. Eligible Americans could claim unpaid funds on their tax return.
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“Refunds may be less in 2023,” the IRS said in a November press release about preparing for the upcoming tax season. “Taxpayers will not receive an additional stimulus payment with a 2023 tax refund because there were no economic impact payments for 2022.”