This article was contributed by Emily Morgan who is a staff writer and an editor at the PayDaySay platform.
Welcome to the 2023 Tax Season! As always, it’s critical to remain on top of your taxes and file appropriately and on time this year. During tax season, there are a few changes to be aware of, along with some basic pointers and strategies to make the procedure go more smoothly. This article will cover all the information you require concerning the 2023 tax filing season.
Tax Law Amendments in 2023
Before entering the intricacies of tax filing, you must stay current on any tax law changes that may impact you. As of 2023, there are a few changes to be aware of:
Standard Deduction
The standard deduction has been increased somewhat this year. The deduction is now $13,200 for single taxpayers and married couples filing separately. The deduction is $26,400 for married couples filing jointly or eligible widows/widowers. The deduction for heads of a family is $19,800.
Tax Brackets
Tax brackets have also been modified to account for inflation. The lowest tax level for single taxpayers and married couples filing separately is now 10%, while the highest bracket is now 37%.
The lowest bracket is also 10% for married couples filing jointly or eligible widows/widowers, while the highest bracket is 37%. The lowest bracket for heads of household is 10%, and the highest bracket is 37%.
If inflation is causing you tax problems and you’re looking for loans or CashNetUSA competitors, which is a fairly common problem, don’t get into debt and consider other options.
Retirement Accounts
This year, contribution limits for retirement accounts such as 401(k)s and IRAs have also been raised. The 401(k)-contribution maximum has been raised to $20,000, but the IRA contribution limit has been reduced to $7,000 for those over 50 and $6,000 for those under 50.
Tax Filing Deadlines in 2023
Let’s speak about important tax filing dates for 2023 now that you’re up to date on any changes to tax rules. The following are the essential dates to remember:
- The IRS will begin accepting electronic tax returns on January 23, 2023.
- April 18, 2023 is the date for submitting your taxes without incurring fines or interest. This year’s deadline is April 18th rather than the usual April 15th. This is because April 15th is a Saturday, and April 17th is a holiday in Washington, D.C. (Emancipation Day).
- The deadline to submit a 2022 tax return for hurricane victims in Alabama, California, and Georgia is May 15.
- If you file for an extension, the deadline to file your tax return is October 16, 2023.
Taxes, in general, and especially individual taxes, are the most important source of tax revenue in the United States. That is why deadlines and accountability are so important for the state.
Tips for a Stress-Free Tax Season
Collect Your Documents
Gathering the relevant documentation is the first step in filing your taxes. This includes the following:
- W-2s: These documents reflect how much you earned and how much tax was withheld from your job(s).
- 1099s: These forms report earnings from freelance work, rental income, and investments.
- Deduction records: Any documentation of charitable contributions, medical bills, or company expenses.
- Social Security numbers: You must have the Social Security numbers for yourself, your spouse, and any dependents you intend to claim.
- Last year’s tax return: Having your previous year’s tax return handy might help ensure you don’t forget anything this year.
Contact the appropriate entity (such as your company or banking institution) if you need a document copy.
Do Your Taxes Yourself or Hire a Professional
You’ll need to decide whether you’ll file your taxes yourself or hire an accounting professional or tax preparer as you figure out how to prepare for tax season.
The more complicated your tax situation, the better it may be for an experienced tax consultant to handle your return. Run a business and must file both personal and commercial tax returns. An accountant can assist you in ensuring that all information is accurate and properly filed to the IRS.
But, if your tax situation is straightforward — for example, if you’re a single filer with a W-2 job who doesn’t own a home or have children — using tax filing software may be easier and less expensive.
Check Your Filing Status
Your filing status impacts the tax rates and deductions you are qualified for. There are five different filing statuses:
- Single: For people who are not married and do not qualify for another filing status.
- Married filing jointly: This option is for married couples who want to submit a single tax return.
- Married filing separately: This option is available to married couples who prefer to file separate tax returns.
- Head of household: This category includes unmarried people financially responsible for a child or other dependant.
- Qualified widow(er) with a dependent kid: Those who have lost their spouse and have a dependent child are eligible.
Choose Your Filing Method
You have two options for filing your taxes: online or by mail. Electronic filing (e-filing) is more efficient, accurate, and secure than paper filing. If your AGI is less than $72,000, you may e-file for free using the IRS’s Free File program. If your AGI is over $72,000, you may utilize professional tax software or visit a tax consultant.
You can still file by mail, but it takes longer to complete and is more prone to errors.
Fill Up Your Tax Paperwork
You must complete your tax paperwork before proceeding. 1040 is the principal form for recording income and calculating taxes. You must also complete any other papers related to your case (like Schedule A for itemized deductions or Schedule C for self-employment income).
While filling out forms, double-check your calculations and enter your information correctly. It is critical to be precise because inaccuracies may cause your return to be delayed or result in fines.
Do a Tax Calculation
When you’ve completed your paperwork, you’ll need to figure out how much you owe (or how much of a return you should get). This is accomplished by claiming deductions and credits from your income and applying the correct tax rate.
Whether you use tax software or hire a tax expert, they will handle this. You can compute your taxes using the IRS’s tax tables or tax software.
Conclusion
Tax season may be stressful, but with the right knowledge and planning, you can make it go more simply and easily. Consider any changes to tax rules for 2023 and be aware of significant tax filing deadlines.
Collect your documentation as soon as possible, consider utilizing tax software or hiring a professional, and double-check your return for errors before submitting it. Following these recommendations, you can tackle tax season with confidence and ease.
About the author
Emily Morgan is a staff writer and an editor at the PayDaySay platform. Her work in the financial industry for over six years brought her practical experience in money management. Now she shares her expertise with those who would like to take control of their finances efficiently. She creates reports, service reviews, compares financial products, and writes about loans, credit reports, and debts. Emily also covers general issues on money management and advises on financial goal setting and personal finances.
Last Updated on April 20, 2023 12:32 pm CEST by Markus Kasanmascheff
