As tax season kicks off, millions of Americans are gearing up to file their 2024 income tax returns.
This annual task can feel overwhelming for many, but getting organized early can make the process far more manageable. Gathering all necessary tax documents, such as W-2s, 1099s, and receipts for deductible expenses, is a crucial first step. Staying on top of deadlines and understanding recent tax changes can help taxpayers avoid costly mistakes or penalties.
While the filing deadline is still months away, the sooner you start, the smoother the process will likely be.
This year’s notable development is the expansion of free filing options for eligible taxpayers. The IRS continues to promote its Free File program, which provides no-cost federal tax filing for individuals earning $73,000 or less, reported CNN Business. In addition, some states offer free filing for state income taxes through their own programs. These services can save qualifying taxpayers hundreds of dollars in filing fees, making it an excellent resource for those who meet the criteria.
Tax credits and deductions also remain key considerations for filers. Popular credits, like the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC), can significantly reduce the amount owed or even result in a refund. Student loan interest or tuition deductions may also apply to taxpayers who paid for higher education. Meanwhile, self-employed individuals should be mindful of business-related expenses, which can be deducted to lower their taxable income.
Professional assistance might be necessary for those with more complex tax situations. Taxpayers with multiple sources of income, investments, or significant life changes—such as a marriage, divorce, or the birth of a child—may benefit from consulting a tax advisor or using specialized software. Although these options have added costs, they can help avoid errors and ensure compliance with ever-evolving tax laws. Tax professionals can also provide guidance on new regulations that could impact your filing this year.
Filing early can offer several advantages, particularly for those expecting a refund. Submitting your return sooner helps you receive your money faster and reduces the risk of falling victim to tax fraud. Scammers frequently target taxpayers by filing fraudulent returns in their names to claim refunds. The IRS recommends filing as early as possible and using direct deposit to ensure refunds are processed securely and quickly.
Taxpayers should also be aware of potential penalties for missing deadlines or underreporting income. The IRS imposes fines for late filings and payments, which can quickly add up. If you anticipate difficulty meeting the April 15 deadline, requesting an extension can provide extra time to file without incurring penalties. However, an extension does not delay the payment deadline, so estimating your tax liability and making any necessary payments by the original due date is important.
Whether you’re filing independently or seeking professional help, approaching tax season with a plan can turn a daunting task into a manageable one.