Friends, What do you need to know before filing your taxes? What things should be kept in mind? Let us know:
Important Points
- Individual filers can now begin filing their tax returns for 2025 as of 27 January.
- Many people are eligible for free tax filing options this season.
- An extension of time to pay and File may be granted for those affected by a natural disaster, like the victims of the California wildfires.
What do you need to know before filing your taxes?
The IRS received millions of tax returns as it opened the tax season in January. Many filers were eager to receive a refund.
Credit Karma’s survey of 1,000 adults conducted in December and January found that nearly 40% of taxpayers will depend on refunds to make ends meet this year.
The IRS anticipates that more than 140 million individual tax returns will be filed for the tax year 2024 before the federal deadline of 15 April.
Before you file your taxes, there are a few things that you should know.
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Many taxpayers qualify for free filing
Financial experts say that if you want to pay your taxes for free in 2024, there are a few options.
According to the U.S. Department of the Treasury, more than 30 million taxpayers may be qualified for Direct File, the IRS’s free tax filing program, this season.
Direct File is now available in 25 states and will “cover more tax situations this year than last,” former IRS commissioner Danny Werfel told reporters at a press conference in early January.
IRS free file is another option that offers guided tax preparation software for free if your adjusted Gross Income was less than $84,000 in 2024.
According to Tim Hugo of the Free File Alliance, although 70% of eligible taxpayers are entitled to IRS Free File, only a tiny fraction use it.
Several filers are eligible for additional guidance through Volunteer income tax assistance or VITA. The IRS runs this program, and it’s free. If your AGI is less than $67,000, you’re usually eligible.
Tax relief for natural disaster victims
The federal tax deadline for most filers is 15 April, but some filers, including California wildfire survivors, have an extension to pay their taxes and file returns. The IRS offers a detailed list of IRS Tax Relief.
In December, Congress extended tax breaks to ensure that victims of natural disasters declared by the federal government would be covered from 2020 until early 2025. Some filers may qualify for more significant tax breaks for losses.
The return of missing forms can be delayed.
Brian Long, certified public accountant and senior tax advisor with Wealth Enhancement, Minneapolis, says that while it might be tempting to rush to complete your return, gathering all the required tax forms is essential. If you don’t, your IRS system could flag it for incorrect or missing information. This could cause a delay in processing.
Long said you can still use your previous year’s tax return to check for accuracy.
Experts say that while many tax forms arrive between mid-February and March, others could come later.
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