2022 Tax Season: What You Need to Knowadmin
The tax season is underway as millions of Americans continue getting their documents together to file their tax refunds. The Internal Revenue Service (IRS) continues to encourage taxpayers to take important actions for a seamless process of filing federal tax returns in 2022. Individual income tax returns filing have already begun, but may have delays in refunds as the IRS struggles with backlogs as well as staff shortages. Here is everything you need to know about the 2022 tax season.
Who must file tax forms for the 2022 tax season?
Even if you did not earn any income in the United States, but you were physically present in the country between 1st January 2021 and 31st December 2021, you are obligated to file Form 8843 with the Internal Revenue Authority. Otherwise, everyone that earned any taxable income should file federal tax returns with the IRS. Depending on the individual circumstances, you may also be required to file state tax returns.
How to File your Taxes
It’s important to have all your documents ready and in good order when preparing to file your taxes this year. The IRS provides a breakdown of everything you need prior to filing your return. Well-organized tax records are important in making the process of preparing a complete and accurate tax return easier. Proper preparation avoids errors that can potentially lead to processing delays with your tax refund. You should have the following documents before filling your return:
- Forms W-2 – This form should be given by your employer(s).
- Forms 1099 from the banks, issuing agencies, as well as other payers, such as unemployment compensation, dividends, distribution from a pension annuity or retirement plan.
- Form 1099-K, 1099-MISC, W-2 or any other income statement for those who have worked in the gig economy.
- Form 1099-INT, for those who have been paid interest.
- Income documents as well as records for virtual currency transactions.
- Form 1095-A, Health Insurance Marketplace Statement, in order to reconcile advance premium tax credits for Marketplace coverage. The IRS to report certain information about individuals who enroll in a qualified health plan via Health Insurance Marketplace.
- Letter 6419, 2021 Total Advance Child Tax Credit Payments in order to reconcile your advance Child Tax Credit Payments. Taxpayers should keep this, and any other IRS letters about advance CTC payments, with their tax records. Families who received advance payments must:1. File a 2021 tax return
2. Compare the advance payments received in 2021 with the CTC amount they claim for 2021.
- Letter 6475, your 2021 Economic Impact Payment, in order to determine whether you’re eligible to claim the Recovery Rebate Credit on your 2021 tax year returns. The letter provides the total amount of the third Economic Impact Payment and any plus-up payments received for the tax year 2021. For the married individuals who are filling a joint return, each spouse is expected to receive their own letter showing half of the total amount.
Higher Standard Deductions in 2021 and 2022
When you’re paying taxes, you have an option of taking the standard deduction or itemizing your deductions. Itemizing means that you have to calculate your deductions one by one. Itemizing could be challenging but worth it if your deductions exceed the amount of the standard deduction. For the tax years 2021 and 2022, the standard deduction has gone up slightly in order to adjust for inflation. For single, the standard deduction has increased from $12,550 in 2021 to $12,950 in 2022. For married filing jointly, the standard deduction has increased from $25,100 to $25,900. For married filing separately, the standard deduction has increased from $12,550 to $12,950. For head of household, the standard deduction has increased from $18,800 in 2021 to $19,400 in 2022.
When should you file your taxes?
IRS announced that the country’s tax season began on Monday, 24th January 2022. This means that the IRS has already started accepting and processing 2021 tax year returns. The IRS encourages everyone to have all the information they need before starting the filling process in order to ensure that they file a complete and accurate return. The IRS is also mailing special letters to recipients, and they can also check amounts received by IRS.gov.
For most taxpayers, the filing deadline to submit 2021 tax returns or an extension to file and pay tax owed is Monday, 18th April 2022. The due date is on 18th April instead of 15th April because of the Emancipation Day holiday in the District of Columbia for everyone except taxpayers who live in Maine or Massachusetts. By law, state holidays usually impact tax deadlines in the same way federal holidays do. The taxpayers in Maine and Massachusetts have an extension deadline of until 19th April 2022 to file their returns. This is due to the Patriots’ Day holiday in those respective states. The taxpayers that will request an extension will have until Monday, 17th October 2022 to file their returns.
When will you receive your tax Refund Check?
Refunds are mostly received within three weeks of the date when the IRS receives your tax return and it’s even faster if an individual chooses to have the return directly deposited into their checking or savings account. The IRS usually recommends that taxpayers arrange to get their refunds by direct deposit. The fastest way to get your money is to use the combination of electronic filling (e-filling) with a direct deposit, which sends the money into your bank account directly. According to the IRS, most taxpayers who file electronically and choose direct deposit usually get their refund within 21 days. This is if there are no problems with the return.
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