Get ready for 2024 tax filing: IRS announces new guidelines and tips
The IRS has released a series of important updates and recommendations to assist taxpayers in preparing for the 2024 tax filing season.
This announcement, part of a series of reminders, aims to streamline the tax filing process and inform taxpayers of significant changes.
Enhancements to IRS online account
Taxpayers and ITIN holders can now utilize their Online Account for various tax-related activities.
This includes:
- Viewing and paying tax owed.
- Requesting tax transcripts.
- Applying for payment plans.
- Accessing digital copies of IRS notices.
- Reviewing key data from recent tax returns.
Power of attorney and tax info authorizations
A notable addition is the ability to view, approve, and electronically sign power of attorney and tax information authorizations directly online.
Understanding refund delays and timing
The IRS cautions against expecting refunds by a specific date, as various factors can affect the timing. Particularly:
- Refunds involving Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC) cannot be issued before mid-February.
- Most refunds are issued within 21 days, but some may take longer due to errors, missing information, or suspected fraud.
Also read - Child Tax Credit: What's new and what's next
Estimated tax payments
Taxpayers with non-wage income sources should consider making estimated or additional tax payments.
The Tax Withholding Estimator on IRS.gov can assist in determining if such payments are necessary.
Preparing tax documents
Taxpayers are advised to organize all necessary documentation, including:
- Income documents like Forms W-2, 1099, 1099-K, 1099-NEC, 1099-MISC, and 1099-INT.
- Records of all digital asset transactions.
Delay in 1099-K reporting threshold
The new $600 reporting threshold for Form 1099-K has been delayed for 2023. The threshold for 2023 will remain at over $20,000 with more than 200 transactions. A phased implementation is planned for 2024, starting with a $5,000 threshold.
Energy-related tax credits
Taxpayers who purchased vehicles or made home energy improvements in 2023 should be aware of the credits available under the Inflation Reduction Act of 2022.
Forms 8936 and 5695 will be required to claim these credits.
Speeding up tax refunds
The fastest way to receive tax refunds is through electronic filing and choosing direct deposit.
Taxpayers without a bank account are encouraged to explore options like FDIC-insured banks, credit unions, or prepaid debit cards with routing and account numbers.
The IRS emphasizes the importance of understanding these new changes and preparing accordingly to ensure a smooth and efficient tax filing experience in 2024.