Brace yourself. It’s tax season.Starting Jan. 27, the Internal Revenue Service will once again begin accepting and processing 2024 returns.
The good news? Things are actually getting better at the IRS. The head of the National Taxpayer Advocate, a watchdog agency that observes the IRS, said in its 2024 report that “For the first time since I became the National Taxpayer Advocate in 2020, I can begin this report with good news: The taxpayer experience has noticeably improved.”
That could be more timely refunds and improved customer service. That said, there’s still an abundant supply of confusion among taxpayers. Fortunately, free help is available when you’re putting together your taxes—and you can always get an extension.
Here are some answers to the most frequently asked tax questions.
When does tax filing season begin?
The Internal Revenue Service will begin accepting and processing tax returns for the 2024 tax year on Jan. 27.
The start of tax season is generally one of two peak times for the IRS, as people with relatively simple tax filings and those expecting big refunds often file as soon as possible. Many people, though, might not have all the paperwork they need at the start of filing season, or might want to wait to file if they expect to owe taxes.
When are my 2024 taxes due?
You've got until Tuesday, April 15 to file your taxes this year. Residents of California impacted by wildfires now have until Oct. 15, while people impacted by Hurricanes Helene or Milton now have a May 1 deadline.
Not able to finish by then? You can file for an extension before that date, which will give you until October 15 to file. Also, special rules apply to people serving in the Armed Forces who are in a combat zone/ contingency operation or have been hospitalized due to an injury sustained in such an area. Those individuals have 180 days after they leave the area to file and pay taxes.
What’s the standard deduction for the 2024 tax year?
The standard deduction for married couples filing jointly jumped $1,500 to $29,200. For single taxpayers and married individuals filing separately, the standard deduction is now $14,600, a $750 increase. And for heads of households, the standard deduction will be $21,900, up $1,100 from a year ago.
When will I get my refund from the IRS?
Typically, the processing time for returns that receive refunds in 21 days.
The average tax refund in 2024 (for the 2023 tax year) was roughly $3,050—5% higher than the year before, according to tax officials.
More than 163 million individual tax returns for the 2024 tax year are expected to be filed, with the vast majority of those coming before the traditional April tax deadline. The IRS says the vast majority are issued within three weeks of the day the return is filed. The best place to track where things stand is with the Where's My Refund? tool, which updates the status of tax refunds daily.
What's the fastest way to receive my refund?
The best way to speed things along, according to the IRS, is to e-file your taxes. That gets the information into the IRS system a lot faster than paper filings.
Step two: Make sure you’ve signed up for direct deposit, as the IRS says that can significantly speed up your refund. It also adds more flexibility. Your refund can be split into up to three separate accounts, including Individual Retirement Accounts.
I bought and sold cryptocurrencies last year. Will that affect my 2024 taxes?
It could. A lot will depend on when and if you sold.
Cryptocurrencies are subject to capital gains, meaning what you owe will depend on how much you gained or lost—and how long you held the tokens. It could be anywhere from nothing to 20% of your profits if you’re a long-term investor. If you jumped in this year, though, and held the crypto for less than a year, you’ve triggered short-term capital gains and could owe up to 37% of your returns. Ideally, your exchange will provide you a Form 1099-B, summarizing profits and losses, but not all exchanges have proven to be as reputable as investors would like.
I bought and sold meme stocks in 2024. What sort of tax bill should I expect?
Just like crypto investors, short-term capital gains of up to 37% could apply.
What happens if I file my taxes late?
You’ll end up paying more. There are two kinds of fees and penalties that could be assessed on top of any taxes you might owe: one for filing late, and another for paying late. If you file your return more than 60 days late, you’re likely looking at a minimum penalty of $485 (unless you owe less than that—in which case, the penalty is 100% of the unpaid tax). Otherwise, the penalty can be as much as 5% of the unpaid tax each month up to a maximum of 25%.
(The amount can be cut considerably if you work out a payment agreement with the IRS.)
Of course, if you file for an extension, these penalties do not apply. Similarly, if you can show reasonable cause for not filing, you’ll avoid them as well. And if you historically have filed on time, you might qualify for the First Time Abatement program, which will help you avoid any fees.
How can I get a bigger refund next year?
Given the looming possible end of the 2017 tax cuts, taxpayers might be looking for ways to prevent being hit with a tax bill again next year. To protect yourself, the IRS’s Tax Withholding Estimator calculator is the best tool. This helps you target a specific refund amount and help you best prepare for it through adjustment withholdings. If you don’t expect major income fluctuations through the year, it’s likely the best option.
Keep in mind that your income tax withholding is no longer based on your marital status and withholding allowances. Instead, it's now based on your expected filing status and standard deduction. You can also have itemized deductions, the Child Tax Credit and other tax benefits reflected in your withholding.
