If you haven’t sent in your 2023 income tax return yet, you have until April 15 to do so. Unless, that is, you’re among the millions of people who, for different reasons, are granted more time to file later this year.
That includes those who file for an automatic six-month extension by April 15. Taxpayers who choose this option don’t need to give the IRS any explanation as to why they want an extension. But keep in mind, that extension only gives you more time to file your federal income tax return. You still must pay all your taxes owed for 2023 by the April 15 deadline. Otherwise, you may be hit with a failure-to-pay penalty. So, if you’re in this group and think you still owe the IRS money for last year, estimate how much and send in your payment by the 15th.
The next large group of people who don’t have to file by Tax Day are those who live or do business in a locality that was declared a federal disaster area in 2023. If you’re in this group, you’re automatically granted an extension to file as well as an extension to pay what you owe, with no action required on your part. Specific deadlines, however, will differ by location, so check this list if you think you’re affected.
And the last group of folks with more time are those who live in Maine and Massachusetts, which observe Patriots’ Day on April 15. For the roughly 4.4 million households in those states, the tax filing and payment deadline will be April 17. The same goes for those living in Washington, D.C., due to the district’s observance of Emancipation Day on April 16.
The IRS has already received more than 80 million income tax returns for 2023, according to its most recent figures released Friday. But that is only about half of the total returns it is still expecting to be filed.
If your return is among them, whatever your deadline, here are just a few other things to keep in mind as you prepare your 2023 taxes.
It’s the little things that make a big difference
There are some very simple things to keep in mind so that your return will be error-free and quickly processed by the IRS.
Among them, check your return from last year. It will be a good reminder of all the documents you’ll need to fill out this year’s return. And tally up all the big changes that occurred in your life in 2023 that may affect your tax situation overall (e.g. got married or divorced, had a new baby, sold a property, made a mint on Bitcoin, etc.).
“Taxpayers should collect all key documents, including?Forms W-2 and 1099, as well as any supporting paperwork for tax deductions or credits such as educational credits or mortgage interest payments. Additionally, having the previous year’s tax return accessible is advisable as it may be required,” the IRS advises.
And before submitting your return, check that everything from the spelling of your name, your Social Security number and your filing status are correct, as well as your bank routing and account numbers if you’re electing to receive a refund by direct deposit.
Child tax credit expansion still on ice
Remember all that talk in Congress about a bipartisan tax bill that would include a provision expanding the 2023 child tax credit for many families? Well, that has yet to materialize and may not anytime soon, if at all.
Should something eventually pass, however, that includes a retroactive expansion of the credit, the IRS has said it would make the change on the 2023 tax returns of those who are eligible and have already filed.
Last-minute deduction for 2023 still possible
While 2023 may be in the rearview mirror, you still may be able to sneak in a quick deduction by April 15 to help reduce your 2023 tax liability.
If you have not maxed out your contributions to a traditional IRA. For 2023, you’re allowed to contribute up to $6,500 (or $7,500 if you were 50 or older). Those contributions may be deductible as well if you don’t have access to a workplace retirement plan and your income falls below a certain threshold. If you do have access to a workplace retirement plan, you may get a partial deduction, again depending on your income.
Here is the nitty-gritty breakdown on those income thresholds.
Make sure the tax preparer you use – or used – is reputable
The Justice Department last week echoed what the IRS has said frequently: Avoid using “unscrupulous” tax preparers. The DOJ noted in a release that letting a swindler prepare your return may leave you saddled with penalties and interest on unpaid taxes.
One telltale sign you’re dealing with a scammer? They promise you outsized refunds that seem too good to be true, said Deputy Assistant Attorney General David Hubber of the DOJ’s Tax Division. “If your tax preparer asks you to sign a blank return, refuses to sign your return as your preparer or fails to give you a copy of your return, consult the IRS’s website to make sure that you are not exposing yourself to trouble,” Hubber said.
The IRS further warns taxpayers not to fall for abusive tax avoidance schemes or any of a number of other scam efforts by tax preparers and
Track your refund
The average refund as of March 22 was $3,081, according to IRS statistics.
The majority of tax filers get a refund from the IRS every year, and they typically receive their money within 21 days of filing. If you’re expecting money back and haven’t yet, you can track its progress through the IRS tool Where’s My Refund.
You might be owed an old refund, too. If you didn’t file a return for 2020, you have until May 17 to do so. According to the IRS, more than $1 billion in refunds await those who didn’t file for that first tax year of the pandemic. The median estimate refund amounts differ by state (see the IRS table here) but they range from a low of $761 in Idaho to a high of $1,031 in Pennsylvania.
Besides a refund, the IRS further notes low- and moderate-income earners also may be eligible to receive the Earned Income Tax Credit. The EITC was worth up to $6,660 in 2020 for those with qualifying children.
If you don’t file your 2020 return by May 17, you will forfeit any money owed to you.
And if you do file and are owed a refund, it may be withheld if you have yet to file your 2021 or 2022 returns. The agency also notes that “any refund amount for 2020 will be applied to amounts still owed to the IRS or a state tax agency and may be used to offset unpaid child support or other past due federal debts, such as student loans.”
