Before you start filing your tax in 2023, here are all the answers to some frequently asked questions (FAQs) you need to know:
When can I file taxes in 2023?
The IRS announced the start of tax season on January 23, 2023. Americans have up to April 18, 2023, to file their taxes. The agency has already begun accepting and processing 2022 tax year returns. With the last three years affected by the pandemic, the IRS has taken extra measures to ensure timely refunds and quick service. It is advisable to file your taxes as early as possible in order to get a faster refund. You have until May 15 to file your federal individual and business taxes if you live in California, Alabama or Georgia that were affected by recent storms.
How long does it take to get a tax refund?
The IRS issues usually process the refunds in less than 21 days. It is possible, however, that your tax return will require additional review and take longer to process.
You may not receive the refund amount you expected because of changes made in your tax return. The following may be included:
- The amount of the Recovery Rebate Credit or the Child Tax Credit must be corrected.
- Refund amount offset by past-due tax or debt payments.
Note: According to the IRS, tax refunds in 2023 may be smaller than expected because taxpayers will not receive additional stimulus payments due to the lack of Economic Impact Payments in 2022.
When is the tax deadline for 2023?
In most cases, taxpayers must file their 2022 tax returns or obtain an extension by Tuesday, April 18, 2023, in order to pay their owed taxes. Tax deadlines for everyone are affected by Washington DC holidays as well as federal holidays. As a result of the weekend and the District of Columbia’s Emancipation Day holiday, which falls on April 17, the due date has been changed from April 15 to April 18 this year. Taxpayers planning to request an extension will have until Monday, October 16, 2023, to file their taxes.
What are the tax brackets for 2023?
A tax bracket is a range of incomes that are subject to a particular income tax rate. A person’s income is taxed at a different rate in each of the seven tax brackets in the US.
A crucial aspect of this tax bracket system is that it is based on average chained consumer price index values for each month between August 2021 and September 2022, a period where inflation was at a historical high. The 2023 tax bracket thresholds will remain higher even if inflation drops this year. The income threshold for 2023’s top individual tax bracket was raised from $539,900 to $578,125. This means that nearly $40,000 in individual income will be taxed at 35% instead of 37%.
For individual filers in 2023, here are the tax brackets:
Those earning more than $231,250 are subject to a 35% tax.
In the case of incomes over $182,100, 32% applies.
There is a 24% tax rate for incomes exceeding $95,375.
Incomes over $44,725 are subject to a 22% tax.
If your income exceeds $11,000, you will pay 12%.
For incomes below $11,000, 10% applies.
Joint returns by married couples in 2023 fall into the following tax brackets:
More than $693,750 in income is subject to 37% tax.
Over $462,500 in income is taxed at 35%.
In the case of incomes over $364,200, the rate is 32%.
In the case of incomes over $190,750, 24% applies.
Those who earn more than $89,450 are subject to a 22% tax.
If your income exceeds $22,000, you will pay 12%.
Those earning less than $22,000 are subject to a 10% tax.
How to file a tax extension?
If you want to extend your tax deadline, you can do it electronically or by mail. If you want to avoid a late-filing penalty from the IRS, you should request an extension by April 18.
In the event you don’t plan to use tax software, you might want to consider IRS Free File. Through the Free File Alliance, the IRS provides free, name-brand tax preparation software to people who earn less than a certain adjusted gross income. Online extensions are available to everyone, even those with incomes above the threshold.
Ensure your tax software supports Form 4868 if you plan to use it for tax extensions. The majority of them do. Following the program’s instructions is the easiest way to file an electronic tax extension. As soon as you submit the form, you will receive an electronic acknowledgment from the IRS.
Also, you can apply for an extension by completing Form 4868 on paper and mailing it (it’s less than a page long), but make sure you get proof that you sent it.
What happens if I don’t file taxes?
No matter what your financial situation is, failing to file or pay taxes has significant consequences. Non-payment of taxes will likely result in the following:
You will owe accumulating debt
If you’re tired of filing and have decided not to do it this year, you may want to rethink your decision. You would be required to pay interest and penalties for “failure to file,” “failure to pay” and “failure to pay appropriate estimated tax”.
Failing to file a tax return will result in a charge of 5% of the unpaid tax. If your return is late for more than five months, you’ll have to pay the penalty each month or part of a month.
You could lose your house
The federal government can place a lien on your property, most likely your house, if you owe enough unpaid back taxes. There is also the possibility of getting hit with a state or county tax lien. In the event that you sell your home, the IRS will deposit these documents with the county government, which means you won’t be able to see any profit from your sale. Furthermore, if your home has a lien, you may have trouble refinancing it.
You may experience financial hardship
The IRS will eventually contact you about your back taxes, and if you refuse to cooperate, your bank accounts and wages may be levied. Your passport and driver’s license can also be confiscated, and many other things can be done to make your life miserable. Unless you reach out to the government, they will be relentless, so don’t think just because you haven’t heard from them yet that they will forget about you. They won’t.
Cleaning up your mess will cost you time and money
A tax professional may be able to help you resolve your situation at some point. Form 1040 with Schedule A (allowing itemized deductions), along with a state income tax return, cost an average of $323 in 2021, according to the National Society of Accountants. Including a state income tax return and the standard deduction, the average fee for Form 1040 was $220. Those may not seem like a lot, but when you have several years’ worth of tax filings to catch up on, it adds up.
How do I file my taxes by myself?
Get your paperwork together, including:
- Obtaining a copy of each employer’s W-2 form.
- The 1099 form and the 1099-INT form are other statements of income and interest.
If you are itemizing your tax return, you must include receipts for charitable donations, medical expenses and business expenses. Decide what filing status you want to use. Filing status is determined by your marital status. It is also important to consider how much you pay toward household expenses when filing your taxes.
Your tax filing method should be decided before you begin. To ensure the most accurate and convenient filing experience, the IRS recommends e-filing with tax preparation software. If you are itemizing your return, determine whether you are taking the standard deduction. You may be able to apply for a payment plan if you owe money in taxes.
Additionally, tax preparation and filing software can be used for free to prepare and file your federal income tax return. Using IRS Free File will make your life easier.
Important dates for Tax Filing 2023
During this year’s tax filing season, taxpayers should keep the following dates in mind:
April 18, 2023
Taxpayers residing in the United States have until this day of April 2023 to file their individual income tax returns and state tax returns. An extension of six months can be requested by filing Form 4868 with the IRS.
June 15, 2023
Taxpayers who live outside the US on April 18, 2023, will have an automatic extension of the due date for their 2022 returns. Unpaid taxes will, however, continue to accrue interest from April 18, 2023, until settled.
In order to extend your filing deadline by four months, you should submit Form 4868 to the IRS. Those residing outside of the United States must file state tax extensions by this date.
October 18, 2023
Those requesting an extension on their 2022 tax returns must file by this date.
Who should file taxes?
There is no requirement for everyone to file their taxes. There are four factors that determine whether you need to file your taxes: your income, filing status, age, and special circumstances.
Tax credits and other benefits may be available to you even if you are not required to file taxes.
Who needs to file their taxes based on the Income
Tax filing thresholds are set by the IRS every year. Your tax return is required if your gross income in 2022 is greater than the amounts listed below.
Any income that you pay taxes on is considered gross income. Your age is decided by how old you were on December 31, 2022.
Who needs to file their taxes based on their age and filing status
|Filing Status||Gross Income (Taxpayers under 65)||Gross Income (Taxpayers over 65)|
|Head of Household||$19,400||$21,150|
|Married Filing Jointly||$25,900 (both spouses)||$27,300 (one spouse)$28,700 (both spouses)|
|Married Filing Separately||$5||$5|
|Qualifying Widow with Dependent Child||$25,900||$27,300|
Who needs to file taxes based on some special circumstances
Additionally, tax returns are generally for people regardless of income in the following conditions:
- You earned a minimum of $400 as a self-employed individual.
- Distributions from health savings accounts, Archer Medical Savings Accounts or Medicare Advantage MSAs were made.
- Taxes are due on IRAs, health savings accounts and other tax-favored accounts.
- Taxes are due on household employees.
- The alternative minimum tax you owe is due.
- Your earnings from a church or church organization exceeded $108.28.
- Taxes on recapture are due.
- If you didn’t disclose tips to your employer or your employer didn’t already deduct the tax, you owe Social Security or Medicare tax.
- In the event that you or a dependent purchased health coverage through the insurance marketplace, you were given an advance payment of the premium tax credit.
- Apart from tips you reported to your employer, group-term life insurance and extra taxes on health savings accounts, you owe unpaid Social Security, Medicare, or railroad retirement taxes.
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