Spring is right around the corner, and that means warmer weather, baseball season, baby animals and… taxes.
The deadline for most people to file their taxes this year is April 18. That might seem like a long time away now, but here’s no reason to wait. Doing your taxes early can help protect you against fraud. Plus: The quicker you file, the quicker you can receive your tax refund.
Read on for everything you need to know about filing taxes in 2023.
Gather your materials
You’ll need data and documents about your finances in 2022 to file your tax return. Before you start, you should have all that information handy. That could include:
- Your Social Security number or Tax Identification Number
- Last year’s tax return
- A W-2 form from your employer
- Information about anyone you plan to claim as a dependent
- Other statements with your 2022 income, including 1099s (there are quite a few different types of 1099 forms, and they cover all types of income, from the gig economy earnings — 1099-NEC or 1099-K — to unemployment benefits — 1099-G. You may also have a 1099-B from the sale of stocks or dividends or 1099-INT for income from interest.
A good way to think about what materials you’ll need is to consider the major changes in your life last year. Did you change jobs? Sell stocks? Take out student loans? Get married? Have a baby? Those life events will all impact your taxes.
Decide whether you’re itemizing or taking the standard deduction
Taxpayers have two ways to take advantage. There’s the standard deduction, which will reduce your taxable income by a predetermined amount. Ever since the Tax Cuts and Jobs Act became law, the vast majority of people choose this option, which eliminates the need to keep track of records and receipts for itemizing (more on that below).
The IRS adjusts the standard deduction every year to account for inflation. For the 2022 filing year, the standard deduction is $12,950 for single taxpayers, $25,900 for couples filing jointly and $19,400 for heads of household.
Next year, the standard deduction will be $13,850 for single taxpayers, $27,700 for couples filing jointly and $20,800 for heads of household.
But if your eligible expenses exceed the standard deduction amount, it might make sense for you to itemize them. You’ll need to list them all and add them up, then deduct that number from your taxable income. If you choose to itemize deductions, you’ll need to gather all the receipts and paperwork related to those expenses.
Determine whether you’re eligible for tax credits
Depending on your circumstances, you could be able to reduce the amount of taxes you owe through tax credits.
Some popular tax credits include the child and dependent care credit, the earned income tax credit, and the American opportunity tax credit. You’ll need specific documentation to claim these credits, so be sure to be prepared.
Decide how you’ll file
There are a number of ways you can file your federal tax return. You can fill out the forms yourself (the IRS has detailed instructions here) and mail them in, but most tax experts don’t recommend this method. It's much slower than filing electronically, and it's less secure.
You can use the IRS’s Free File service to fill out and file your tax forms electronically. If your adjusted gross income was less than $73,000 or less last year, you’re eligible for guided tax preparation free of charge. If you made more than that, you can still fill out the forms online but you won’t receive any guidance.
You can also use tax software like TurboTax or H&R Block to e-file your taxes. Depending on your circumstances, you might be eligible to file for free.
Some people prefer to hire a professional to file their tax returns for them — especially if their financial situation is complex. This person can walk you through the process on an individual basis, but it may be a more expensive option.
If you owe money, make plan to pay
Once you’ve filed your paperwork, you’ll either owe money to the IRS or be owed a tax refund by the IRS. If you’ll owe taxes for 2022, make a plan to pay them. They’re due on April 18 for most people (even if you request an extension).
If you expect a refund, here’s what you need to know
The IRS pays most refunds within 21 days of getting your tax return. If you have direct deposit information on file with the agency, you can receive your money electronically. Otherwise, the IRS will mail you a check.
If you filed your taxes on paper, or if your return had errors or needed extra attention, it could take much longer.
You can always track your refund using the IRS’s Where’s My Refund? tool. You’ll need your Social Security number or taxpayer identification number as well as your filing status and the exact refund amount you calculated on your return.
Need more time?
You can submit a form through the IRS to get an automatic extension that will give you an extra six months to get your return in order.
This year, the extended filing deadline is Oct. 16. But remember: The extension only applies to filing your return. You'll still need to pay the IRS any money you owe by the regular deadline of April 18.