Understanding Tax Season
Tax season is the period between January 1 and April 15 each year when individual taxpayers report their taxable income to the federal government, and often to the state government as well. Typically, April 15 is the last day to file; if it falls on a weekend, the deadline is extended to the next business day. However, the deadline can be further extended under certain circumstances. For example, residents in 55 California counties saw a delay to November 16, 2023, due to a winter storm disaster. Similarly, in 2020, everyone got a three-month extension because of the COVID pandemic.
If you submit your tax returns after the deadline, you might face penalties and interest charges. While extensions can be filed, these will only delay paperwork, not the actual payment of owed taxes. The upcoming 2024 tax season runs from Jan. 1 until April 15, 2024.
Key Takeaways
- Important Forms: By late January 2024, taxpayers should receive their 2023 tax documents such as W-2s, 1099s, and 1099-Bs.
- Tax Day: Mark your calendars for Monday, April 15, 2024.
- Document Safekeeping: The IRS suggests keeping past tax returns for at least three years for audit purposes, extending up to seven years in cases of fraud suspicion.
Let’s Dive Deeper: The Purpose of Tax Season
You don’t need to spend the entire three and a half months working on your taxes. This period exists largely for employers, financial service providers, and others to gather and distribute necessary paperwork.
Important Dates and Forms
By January 31, employers must send out W-2s to employees, while independent contractors should receive Form 1099-NEC. Contractors earning $400 or more from self-employment are required to file a tax return and pay self-employment taxes.
Extensions
Occasionally, the IRS extends the April 15 deadline. For instance, following severe snowstorms in 2021, residents and businesses in Texas got a two-month extension. Likewise, authorities extended deadlines for areas hit by spring storms in Tennessee, Alabama, and Kentucky.
Why Filing Early is Advantageous
Although you might be tempted to procrastinate on filing your taxes, filing early can offer several benefits:
- Receive Refunds Faster: An early file means you get any due refunds sooner.
- Avoid The Last-Minute Rush: You can bypass long queues and potential delays.
- Prepare Thoroughly: More time allows you to gather all necessary documentation to claim deductions effectively.
- Professional Guidance Is More Accessible: Accountants are less busy early in the season, ensuring you receive undivided attention.
- Prevent Identity Fraud: Filing early reduces your risk of identity theft.
Early Tax Filing for 2024
The IRS typically starts accepting returns in January, though no exact date is set at the time of writing. Forms from employers and other income sources generally arrive by late January.
Free Tax Filing Options
The IRS provides options for free electronic filing for most taxpayers through the IRS.gov website or the IRS2Go app. Specific tax return software also offers free filing for those below certain income levels. Note that state taxes have separate procedures and requirements.
When Will I Receive My Tax Refund?
As per the IRS, most refunds reach taxpayers within 21 days of filing. Filing early usually ensures a quicker refund, allowing you to stay ahead of potential delays.
The Bottom Line
Tax season is a crucial period for organizing and submitting your tax-related documentation to the necessary authorities, usually by April 15. You’ll start gathering necessary documents in January, and timely submissions will save you from penalties and interest. Regardless of the method, you choose for filing, getting started early will make the process smoother and more manageable.
Related Terms: IRS, W-2, 1099 form, tax return, tax deadline, tax refund, self-employment taxes.
References
- Internal Revenue Service. “When to File”.
- Internal Revenue Service. “For California Storm Victims, IRS Postpones Tax-filing and Tax-payment Deadline to Nov. 16”.
- Internal Revenue Service. “Filing and Payment Deadline Extended to July 15, 2020 - Updated Statement”.
- Internal Revenue Service. “Failure to File Penalty”.
- Internal Revenue Service. “Topic No. 305, Recordkeeping”.
- Internal Revenue Service. “Topic No. 752, Filing Forms W-2 and W-3”.
- Internal Revenue Service. “General Instructions for Certain Information Returns, (Forms 1096, 1097, 1098, 1099, 3921, 3922, 5498, and W-2G)”. Page 27.
- Internal Revenue Service. “Topic No. 554, Self-Employment Tax”.
- Internal Revenue Service. “IRS Announces Tax Relief for Texas Severe Winter Storm Victims”.
- Internal Revenue Service. “IRS Extends May 17, Other Tax Deadlines for Victims of Tennessee Storms; Provides Special Guidelines for Disaster Area Individuals Needing Further Extensions”.
- Internal Revenue Service. “IRS Sets January 23 as Official Start to 2023 Tax Filing Season; More Help Available for Taxpayers This Year”.
- Internal Revenue Service. “Tax Season Rapidly Approaching: Get Ready Now to File 2023 Federal Income Tax Returns in Early 2024”.
- Internal Revenue Service. “IRS Free File: Do your Taxes for Free”.
- Internal Revenue Service. “Tax Season Refund Frequently Asked Questions”.
