The 2024 tax season has commenced, as the IRS started accepting tax returns on Monday, Jan. 29, and will continue accepting them until April 15.
Here is everything you need to know about your taxes before Tax Day.
Do I file my taxes online or on paper?
You can fill out a tax form by hand and mail it in, but filing your taxes electronically is recommended as a faster and safer process. If you file a complete paper tax return, it can take between six and eight weeks from the date the IRS receives it to receive your refund. However, if you file your taxes online, it can take three weeks for the IRS to process the forms and even less time if you choose direct deposit.
It takes 21 days to issue refunds, according to the IRS. If someone files his or her taxes electronically on Jan. 29, the earliest possible day he or she can receive a tax refund is Feb. 19.
What do I need to file my taxes?
Whether you are filing taxes yourself or turning to a tax preparer, the necessary documents will depend on the status of your employment. Everyone will need their Social Security number, as well as their spouse’s and dependents’, if any. Filers will also need their federal and state income taxes from the year prior.
Employed people will need a W-2 form. Those who are unemployed will need a 1099-G, and self-employed people will need a 1099 form.
For a comprehensive list of all tax documents, visit the IRS website.
What happens if you don’t file your taxes or miss the deadline?
If the deadline is missed without filing for an extension, taxpayers will have to pay a failure to file penalty, which is 5% of unpaid taxes for each month the return is late. If the deadline to pay is missed, a failure to pay penalty applies, which is 0.5% of the unpaid taxes for each month the payment is late. The penalty won’t exceed 25% of one’s taxes. However, being hit with both penalties at the same time will incur a different percentage penalty.
Taxpayers can file for a tax extension by Tax Day, which would give them six additional months to file, but they would still have to pay their taxes on the date they are due.
How does the child tax credit affect this tax season?
If the child tax credit expansion is enacted, families could see a tax cut of $680 for 2023, according to numbers from the Urban-Brookings Tax Policy Center.
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Will I get a bigger tax refund in 2024?
Taxpayers could see larger refunds this year, specifically those whose income did not keep pace with inflation because rising costs pushed them into a higher tax bracket.
Chief tax information officer at Jackson Hewitt, Mark Steber, told CBS News that some people could see a 10% increase in tax refunds this year, a nice change of pace for taxpayers who saw a 2.6% fall in tax refunds last year. In 2023, the average tax refund was $3,167, according to numbers reported by CBS News.