Tax season underway: Here are some tips to navigate it
IRS offers free guided tax preparation
NEW YORK, March 10, (AP): It’s tax season in the U.S., and for many people, filing tax returns can be a daunting task that’s often left until the last minute. But if you want to avoid the stress of the looming deadline, start getting organized as soon as possible.
Whether you do your taxes yourself, go to a tax clinic or hire a professional, navigating the tax system can be complicated and stressful. Courtney Alev, a consumer financial advocate for Credit Karma, recommends you go easy on yourself.
“Take a breath. Take some time, set out an hour, or go through it over the weekend. You’ll hopefully see that it’s a lot simpler than you think,” Alev said.
If you find the process too confusing, there are plenty of free resources to help you get through it.
Here are some things you need to know:
When is the deadline to file taxes?
Taxpayers have until April 15 to submit their returns from 2023.
What do i need to file my tax return?
While the required documents might depend on your individual case, here is a general list of what everyone needs: Social Security number
W-2 forms, if you are employed 1099-G, if you are unemployed 1099 forms, if you are self-employed
Savings and investment records Any eligible deduction, such as educational expenses, medical bills, charitable donations, etc.
Tax credits, such as child tax credit, retirement savings contributions credit, etc.
To find a more detailed document list, visit the IRS website.
Tom O’Saben, director of tax content and government relations at the National Association of Tax Professionals, recommends gathering all of your documents in one place before you start your tax return and also having your documents from last year if your financial situation has drastically changed.
O’Saben also recommends taxpayers create an identity protection PIN number with the IRS to guard against identity theft. Once you create a number, the IRS will require it to file your tax return.
■ ■ ■ ■ ■ ■ ■ How do i file my taxes?
You can either file your taxes online or on paper. However, there is a great time difference between the two options. Paper filing can take up to six months for the IRS to process, while electronic filing cuts it down to three weeks.
What resources are out there?
The IRS is piloting a program where you can file your federal taxes online for free called Direct File. This program is now available in 12 states, which include California and New York, and for people who have very simple W-2s, an employee’s wage and tax statement.
Aside from Direct File, IRS offers free guided tax preparation that does the math for you. This is available for people who make $79,000 or less per year. If you have questions while working on your tax forms, the IRS also offers an interactive tax assistant tool that can provide answers based on your information.
Beyond the popular companies such as TurboTax and H&R Block, taxpayers can also hire licensed professionals, such as certified public accountants. The IRS offers a directory of tax preparers across the United States.
The IRS also funds two types of programs that offer free tax help: VITA and the Tax Counseling for the Elderly program (TCE). People who earn $64,000 or less a year, have disabilities or are limited English speakers, qualify for the VITA program. Those who are 60 or older, qualify for the TCE program. The IRS has a site for locating organizations hosting VITA and TCE clinics.
If you have a tax problem, there are clinics around the country that can help you resolve these issues. Generally, these tax clinics also offer services in other languages such as Spanish, Chinese and Vietnamese.
How can i avoid mistakes in my tax return?
Many people fear getting in trouble with the IRS if they make a mistake. Here’s how to avoid some of the most common ones:
Double check your name on your Social Security card.
When working with clients, O’Saben always asks them to bring their Social Security card to doublecheck their number and their legal name, which can change when when people get married.
“You may have changed your name but you didn’t change it with Social Security,” O’Saben said. “If the Social Security number doesn’t match to the first four letters of the last name, the return will be rejected and that will delay processing.”
Search for tax statements when you have opted out of paper mail.
Many people like to opt out of snail mail but when you do, it can also include your tax documents.
“If you didn’t get anything in the
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mail doesn’t mean that there isn’t an information document out there that you need to be aware of and report accordingly,” O’Saben said.
Make sure you report all of your income.
If you had more than one job in 2023, you need the W-2 forms of each.
■ What about the child income credit?
Earlier this year, Congress announced a bipartisan agreement to enhance the current child tax credit. Currently, the tax credit is $2,000 per child, but only $1,600 is refundable. The bill would incrementally increase the maximum refundable child tax credit to $1,800 for 2023 tax returns, $1,900 for the following year and $2,000 for 2025 tax returns.
If this agreement goes through, around 16 million children in low-income families would benefit from this child tax credit expansion, according to the Center on Budget and Policy Priorities. Lawmakers are hoping to move this bill as soon as possible.