Taxpayers navigating through the 2023 tax season will find a smoother process compared to the challenges faced during the Covid-19 pandemic. However, new complexities such as crypto reporting rules, green tax credits, and changing retirement distribution start dates have arisen. Forbes offers tips on filing requirements, free filing options, and reporting income from various sources. The importance of applying for an extension if unable to file accurately by the April 15 deadline is emphasized to avoid inaccuracies that could lead to an audit.
For those eagerly awaiting tax refunds after filing their 1040, the IRS’ Where’s My Refund? tool provides updates on the status of refund processing. Various tax developments including expanded 1099-K reports and potential retroactive changes such as the child tax credit and deductions for state and local taxes are discussed. Readers are advised to stay informed on tax-related news by subscribing to the Forbes Tax Breaks newsletter to navigate these changes effectively.
Tax deadlines and extensions are crucial aspects of the filing process, with considerations for residents in disaster areas or overseas. The process of filing for an extension, which provides an additional six months to file, is simplified through Form 4868. The eligibility criteria for filing a 1040 are explained based on filing status, age, and gross income, with additional guidance for college students and Social Security beneficiaries to determine the need for filing.
E-filing is highlighted as a preferred method by the IRS, with paper returns taking longer to process. The IRS Free File program and pilot Direct File program offer options for taxpayers to file for free through private software companies or directly with the IRS. Readers are encouraged to familiarize themselves with tax forms such as Form 1040 and gather essential documents for accurate filing. Tips for understanding tax rates, brackets, and deductions for the 2023 tax year are provided to assist taxpayers in maximizing their returns.
New tax credits for electric vehicles and green purchases, as well as delayed reporting requirements for digital assets, are introduced to taxpayers. Information on retirement distributions, increased retirement contributions, and the importance of correcting errors in tax forms is also discussed. Strategies to lower audit risks and handle discrepancies in tax forms, such as incorrect reporting of interest income, are shared to ensure a smooth filing process. Taxpayers are urged to proactively address errors to avoid delays in tax refunds and minimize IRS scrutiny.
