The upcoming tax filing deadline for the 2023 income tax return is April 15th, however, there are various reasons why certain individuals may receive an extension to file later in the year. One group includes those who file for an automatic six-month extension, allowing more time to file but still requiring taxes owed to be paid by the April 15th deadline. Another group includes individuals living in federally declared disaster areas in 2023, granting an extension to both file and pay taxes. Additionally, residents of Maine, Massachusetts, and Washington, D.C. have until April 17th to file and pay due to observances of Patriots’ Day and Emancipation Day.
The IRS has already received more than 80 million income tax returns for 2023, but this is only about half of the total returns expected to be filed. To ensure a smooth and error-free process, taxpayers should gather all necessary documents, including Forms W-2 and 1099, as well as any supporting paperwork for deductions or credits. It is important to review the previous year’s return for reference and ensure all personal information is correct before submission, such as name, social security number, filing status, and bank routing/account numbers.
The anticipated bipartisan tax bill, which may include an expansion of the 2023 child tax credit, has not been finalized. However, if any retroactive expansions are approved, the IRS will apply the changes to eligible taxpayers who have already filed their returns. Taxpayers may also consider making a last-minute deduction by contributing to a traditional IRA by April 15th to potentially reduce their tax liability for the year.
The Justice Department and IRS advise taxpayers to be cautious of unscrupulous tax preparers who may promise outsized refunds or engage in tax avoidance schemes. Ensuring the chosen tax preparer is reputable and avoids practices that could lead to penalties and interest on unpaid taxes is crucial. The average refund for the 2023 tax year was $3,081, and most filers typically receive their refunds within 21 days of filing. Refund status can be tracked using the IRS tool Where’s My Refund.
Individuals who did not file a return for 2020 have until May 17th to do so and may be entitled to a refund. Over $1 billion in refunds are waiting for those who did not file for the first tax year of the pandemic, with varying median refund amounts based on state. Additionally, low- and moderate-income earners may qualify for the Earned Income Tax Credit, which was up to $6,660 in 2020 for those with qualifying children. Failure to file the 2020 return by the deadline may result in forfeiting any owed refunds and potential offsets for unpaid federal debts or child support.
