Filing your tax return is an annual ritual and while it may not be your fave, it’s one we’ve all got to handle. But beyond the chore of filing, part of getting your taxes done accurately means keeping up with the ever-evolving tax code. Ah.
Getting some of these key tax questions answered early can help you tackle your filing with a lot less stress. If you’re already in tax prep mode, here are some of the top FAQs to review before sending in your return.
- How do I know if I have to file a tax return?
- What filing status should I choose?
- When are taxes due?
- How do I file a tax return?
- How do I contact the IRS?
How do I know if I have to file a tax return?
The Internal Revenue Service has set guidelines for determining who has to file a tax return and who doesn’t. These guidelines are based on your age, filing status, and household income.
As a general rule, if all of the following are true, you would NOT need to file a return for the 2020 tax year:
- You’re single
- You’re under age 65
- You earned less than $12,400 for the year (this represents the standard deduction amount allowed for single filers under 65)
- No special circumstances, such as self-employment, exist that require you to file a tax return
If you can’t check off all those boxes then you’ll most likely need to file a tax return. If you’re still not clear on whether you need to file a tax return or not, the IRS offers a free interactive tax assistant that can help.
What filing status should I choose?
Your tax filing status can determine which tax breaks you’re eligible for, your standard deduction amount, and how much you’ll end up owing (or getting back as a refund) for the tax year. The IRS allows you to choose different types of filing status:
- Head of household
- Married filing jointly
- Married filing separately
- Qualifying widow(er) with a dependent child
If you’re not married and have no dependents then you’d most likely file single. Head of household status is reserved for people who are not married or legally separated and have dependents who live with them.
If you’re married, the big question may be whether to file a joint or separate return. A joint filing can offer some advantages since you may qualify for more tax breaks and you benefit from a larger standard deduction. But you may choose to file separately if you prefer to keep your tax liability separate from your spouse’s.
If you aren’t sure which one is right for you, the IRS has another handy free tool that can help you choose a filing status.
When are taxes due?
Filing and paying taxes late can put you in hot water with the IRS, not to mention trigger some costly tax penalties.
The failure to file penalty kicks in if you don’t file your return by the scheduled due date. This penalty applies if you don’t pay taxes owed on time. And if you’re a freelancer or gig worker who’s required to make estimated quarterly tax payments, you could also face a penalty if you fail to make those payments on time.
For the 2020 tax year, the deadline to get your income tax return filed is April 15th. You can file an extension that would give you up until October 15th to file, but you’d still need to pay any taxes owed by the April deadline to sidestep the penalty.
If you’re a gig worker who pays estimated taxes, those payments are due four times a year:
- April 15
- September 15
- January 15 (of the following year)
Note: The April payment represents the first payment for the current tax year, while the January payment represents the last payment for the current tax year.
How do I file a tax return?
There are two main ways to file a tax return: e-file (or filing electronically) and filing a paper return via snail mail.
Between the two, the IRS advocates e-filing as the faster and more convenient option. You can submit your return electronically online, without having to mail in any supporting documentation (i.e. W-2s, 1099s, business expense receipts, etc.)
E-filing can also help you get your tax refund faster if you’re owed money back and select direct deposit as your refund option. The IRS tries to process refunds requested this way within 21 days. If you already used direct deposit to receive your stimulus check, using it for your tax refund could be a no-brainer.
The other option is to request your refund in a paper check, which can mean waiting up to six weeks or longer to receive the money. That’s not exactly ideal if your bank account could use a boost.
Once you’re ready to file, there are certain things you’ll need to do so. Here’s a handy tax filing checklist:
- Social Security Number
- Date of birth
- Bank account information (if requesting direct deposit refund)
- Copies of your W-2s
- Copies of 1099s or Schedule K-1 forms if you’re self-employed
- Records of estimated tax payments if you made them
- Information about your Economic Impact Payment (if you received one)
- Information about unemployment benefits on Form 1099G (if you received them)
- Other income, such as savings account interest earned or dividend income from investments
- Receipts or records for any business, self-employment or gig work expenses you plan to deduct
- Statements showing student loan interest or qualified higher education expenses you paid
- Receipts for charitable deductions
- Home mortgage interest paid (if you own a home)
- Information for 401(k), IRA or Health Savings Account contributions you made
- Receipts for child care or medical expenses you paid out of pocket
Note: If you’re married and filing jointly or are claiming dependents, you’ll need their personal information as well. Here’s a helpful tax filing checklist we’ve put together.
If you’re e-filing, you’ll also need to decide which tax preparation software to use. If your income was less than $72,000 for the year, you can file your 2020 taxes for free using IRS Free File. If you don’t qualify for Free File, you can shop around and compare pricing options for different tax filing software programs.
How do I contact the IRS?
If you’re just looking to track your refund, you can use the IRS’s online “Where’s My Refund?” tool. You’ll need to enter your Social Security number, tax filing status and exact refund amount. This tool is updated once each day with new information.
If you want to get help over the phone, you can use the general inquiry line at 1-800-829-1040. IRS representatives are available from 7 a.m. to 7 p.m. local time. Just keep in mind that you may be waiting on hold a while, especially with COVID-19-related questions making for higher call volumes.
Note: You could also call to schedule an appointment at your local IRS office, depend on social distancing requirements where you live.
It’s not uncommon to have tax questions and the sooner you get them answered, the sooner you can get your return filed and your refund on its way. Remember that direct deposit is the fastest and most convenient way to get your refund, according to the IRS. While you’re waiting for your refund to hit your bank account, you can strategize the best ways to put the extra money to work. You got this!