Tax season is officially underway: Though returns are for the 2023 tax year, the Internal Revenue Service (IRS) began accepting them on January 29, 2024. Avoiding last-minute rushes and potential delays starts with early preparation. Take a look (and take note) of this breakdown to help you navigate the season smoothly.
For the majority of taxpayers, the cutoff date is set for Monday, April 15, 2024. However, residents in Maine and Massachusetts have an extended tax filing deadline until Wednesday, April 17, 2024, due to observances of Patriot’s Day and Emancipation Day. Notably, individuals residing in FEMA-declared disaster areas in Connecticut, Maine, Rhode Island, and West Virginia enjoy an extended deadline of June 17, 2024. It’s crucial for taxpayers to be aware of these key dates to ensure timely compliance with their obligations.
Not All States Have the Same Tax Deadline
The majority of states adhere to the standard April 15th deadline for tax filings, but it’s essential to be aware of exceptions. Specific deadlines vary, and it is recommended to consult your state’s Department of Revenue for precise information:
- Massachusetts, Maine: April 17, 2024
- Hawaii: April 22, 2024
- New Mexico, Oklahoma (e-returns): April 30, 2024
- Delaware, Iowa, Virginia: April 30, 2024
- Louisiana: May 15, 2024
- States like Alaska, Florida, Nevada, and others do not impose income tax.
Refund Expectations: When Is Your Money Coming?
For electronically filed returns with a refund, the IRS aims to deliver within 21 days. Opting for direct deposit speeds up the process. Paper returns and those with complexities may take longer.
Consider online tax-filing programs like TurboTax. Their basic edition caters to simple returns and limited credits, with 37% of filers potentially qualifying for free use. For itemized deductions, consider TurboTax Deluxe Online, covering federal and state filings. It also verifies your eligibility for over 350 deductions and credits.
Towards the conclusion of every tax season, the IRS unveils comprehensive filing statistics. In the context of the 2023 tax season, pertaining to the 2022 tax year, around 64% of tax returns filed and processed by April 21, 2023, led to the issuance of tax refunds. As per the IRS’s filing season data, the mean tax refund for the 2023 tax season, corresponding to the tax year 2022, stood at $2,753. Notably, the average for tax refunds via direct deposit exceeded the overall average, reaching $2,827.
In recent years, the year 2021 had the highest tax refund, with an average of $3,012, but this number was impacted by the pandemic-relief–related tax breaks, while the year 2018 averaged $2,729, not that much less but, hey, those bucks add up at the end of the year.
Ignoring Your Tax Obligations Can Lead to Penalties
If you fail to file your taxes on time, the IRS will take certain actions to address the situation. Initially, you may face penalties for late filing and late payment, which can accumulate over time. The penalty for not filing your taxes is generally more severe than the penalty for not paying the taxes owed.
The IRS may also charge interest on any unpaid taxes, which continues to accrue until the full amount is settled. It’s essential to note that avoiding your tax obligations can result in serious consequences. The IRS has the authority to issue a federal tax lien on your property, making it a legal claim against your assets.
In more severe cases, the IRS may initiate collection actions, such as wage garnishment or seizing assets to satisfy the tax debt. However, the IRS typically prefers to work with taxpayers to find a resolution. If you’re unable to pay your taxes in full, you may be eligible for installment plans or other arrangements.