The Sunday Review
The IRS has already received over 100 million tax returns from 2022.
Tens of millions households are still owing their taxes. Here’s some advice for last-minute filers. tax-filing tips As the deadline for Tuesday, 18 April approaches, here are some things to consider.
These online tools can be very helpful if today you have to rush your tax return before midnight. Or, if you’ve come to the realization that you need to file for an extension. Here are a few things you should know.
Thanks to many rounds of extreme weather in recent months, for instance, tax filers in most of California — which accounts for 10% to 15% of all federal filers — have already been granted an extension until Oct. 16 to file and to pay, according to an IRS spokesperson.
If you’re in the armed forces and are currently or were recently stationed in a combat zone, the filing and payment deadlines for your 2022 taxes are most likely extended by 180 days. Your specific extended deadline for filing your taxes and paying them will be determined by the date you left (or entered) the combat area. This IRS publication offers more detail.
You may be exempt from filing a tax return if your income was low or non-existent (under $12,950 for a single filer and under $25,900 for partnered filers). If you feel you might be eligible for refunds, such as refundable tax credit, like the Earned Income Tax Credit. (Use this IRS tool You can use this to determine if you need to file for the current year. If you are eligible, then it is likely that you can also use IRS Free File (intended for those with adjusted gross income of $73,000 or less) so it won’t cost you to submit a return.
It’s possible that your salary is not the only income you receive. You may believe that if you only had one job, it was the sole income and you were required to declare. But that’s not necessarily so.
Some other sources of income that may be taxable or reportable include:
- Savings Interest
- Dividends, capital gains and other investment income
- You can get paid for seasonal or part-time work or side hustles
- Unemployment Income
- Distributions of retirement funds or Social Security Benefits
- You can also check out our Tips
- Casino winnings
- Renting out your property can bring you income
Organise all your tax documentation: You should already have all the tax documents that you are entitled to receive from third parties (your employer or bank).).
If you don’t recall receiving a hard copy of a tax form in the mail, check your email and your online accounts — a document may have been sent to you electronically.
These are some tax forms that you might have received.
- W-2 From your salaried or waged jobs
- 1099-B Capital gains and Losses on Your Investments
- 1099-DIV Dividends and other payments from the company or brokerage where you hold stock
- 1099-INT For interest on savings over $10 in a financial institution
- 1099-NEC If you were a contractor, then your clients may have given you a list of references.
- 1099-K Pay for services and goods using third-party platforms such as Venmo CashApp, Etsy or Etsy. The 1099-K If you have made over $20,000 worth of transactions in the past year, then this is required. The reporting threshold will drop to $600 next year. But even if you didn’t get a 1099-K you still must report all the income that you made over third-party platforms in 2022.
- 1099-Rs Distributions of more than $10 received from a pension or annuity. Retirement account. Profit-sharing plan. Insurance contract.
- SSA-1099 or SSA-1042S Social Security Benefits
“Be aware that there’s no form for some taxable income, like proceeds from renting out your vacation property, meaning you’re responsible for reporting it on your own,” The Illinois CPA Society has released a report.
Reduce your 2022 taxes in the last minute: If you’re eligible to make a tax-deductible contribution to an IRA and haven’t done so for last year, you have until April 18 to contribute up to $6,000 ($7,000 if you’re 50 or older). You will save money on your taxes as well as increase your retirement funds.
Check your tax return for accuracy before you submit it. Do this whether you’re using tax software or working with a professional tax preparer.
Little mistakes and oversights delay the processing of your return (and the issuance of your refund if you’re owed one). Avoid mistakes like a typographical error in your name or birthdate, Social Security Number or Direct Deposit number, choosing the incorrect filing status (e.g. married or single), making an easy math mistake, or leaving a field blank.
What to do if you can’t file by April 18: If you’re not able to file on time, fill out Form 4868 Send it electronically or in paper no later than today. Automatically, you will receive a six-month extension.
A filing extension does not mean that you will have to pay. You will be charged interest (currently running at 7%) and a penalty on any amount you still owe for 2022 but haven’t paid by April 18.
So if you suspect you still owe tax — perhaps you had some income outside of your job for which tax wasn’t withheld or you had a big capital gain last year — approximate how much more you owe and send that money to the IRS by the end of today.
If you prefer to mail it, simply attach your check to the extension form. Be sure to postmark your envelope no later than 18 April.
The more efficient way is pay what you owe electronically CPA Damien Martin is a partner in tax at EY and he told us that you can find IRS.gov. The IRS will note that you won’t have to submit a Form4868 if you follow this advice. “The IRS will automatically process an extension of time to file,” In its instructions, the agency provides a list of important points.
Pay by debit or credit card You will still be charged processing fee. Doing so, though, may become much more costly than just a fee if you charge your tax payment but don’t pay your credit card bill off in full every month, since you likely pay a high interest rate on outstanding balances.
If you still owe income taxes to your state, remember that you may need to go through a similar exercise of filing for an extension and making a payment to your state’s revenue department, Martin said.
You can use this interactive assistant to answer basic tax questions. The IRS Provides an “interactive tax assistant” It can be used to answer 50 or more questions regarding your own circumstances, such as questions regarding income, deductions and credits, etc.