The Internal Revenue Service (IRS) has announced that the 2023 tax season has already begun on Monday, January 23, 2023, when the agency will start accepting and processing tax returns for the 2022 tax year. The IRS expects to receive over 168 million individual tax returns, with the vast majority being filed before the April 18, 2023, deadline. With three extra days to file this year due to the calendar, taxpayers have additional time to submit their tax returns.
The previous three tax seasons were dramatically affected by the COVID-19 pandemic, and as part of the August passage of the Inflation Reduction Act, the IRS has taken additional steps to improve its services to taxpayers. It has hired more than 5,000 new telephone assistors and added more in-person staff to help support taxpayers.
Acting IRS Commissioner Doug O’Donnell said, “With these new additional resources, taxpayers and tax professionals will see improvements in many areas of the agency this year. We’ve trained thousands of new employees to answer phones and help people. While much work remains after several difficult years, we expect people to experience improvements this tax season.”
The IRS has set a special day on January 27, 2023, to encourage people to make sure they understand the important benefits of the Earned Income Tax Credit (EITC), which is a credit that can help low- and moderate-income workers and families. In addition, the IRS recommends that people carefully review their tax situation to ensure they don’t overlook important tax credits they may be eligible for.
The filing deadline to submit 2022 tax returns or an extension to file and pay tax owed is Tuesday, April 18, 2023, for most taxpayers. Taxpayers requesting an extension will have until Monday, October 16, 2023, to file.
The IRS recommends several things for people to keep in mind for a smooth filing experience this year. First, it encourages individuals to have all the information they need before filing a complete and accurate return. They should organize and gather 2022 tax records, including Social Security numbers, Individual Taxpayer Identification Numbers, Adoption Taxpayer Identification Numbers, and this year’s Identity Protection Personal Identification Numbers valid for calendar year 2023. Filing an accurate tax return can help taxpayers avoid delays or later IRS notices.
People should also remember that most income is taxable, including unemployment income, interest received, or money earned from the gig economy or digital assets. Individuals should make sure they report the correct amount on their tax return to avoid processing delays.
The IRS also reminds people to visit IRS.gov first for common questions and to check on the status of their refunds. The agency anticipates making significant improvements to phone service this year for taxpayers and tax professionals as more training for new phone assistors is completed in the weeks ahead. However, the IRS emphasizes it’s important to note that call volumes remain at historically high levels, and taxpayers should visit IRS.gov for the information they need.
The Internal Revenue Service (IRS) has announced a delay in reporting thresholds for third-party settlement organizations (TPSOs) set to take effect for the upcoming tax filing season. As a result of this delay, TPSOs will not be required to report tax year 2022 transactions on a Form 1099-K to the IRS or the payee for the lower, $600 threshold amount enacted as part of the American Rescue Plan of 2021. The new reporting threshold for business transactions is $600 per year, changed from the previous threshold of more than 200 transactions per year, exceeding an aggregate amount of $20,000.
The law is not intended to track personal transactions. The transition period is intended to facilitate an orderly transition for TPSO tax compliance, as well as individual payee compliance with income tax reporting. The IRS noted that the existing 1099-K reporting threshold of $20,000 in payments from over 200 transactions will remain in effect. Additional details on the delay will be available in the near future, along with additional information to help taxpayers and the industry.
To speed refunds, the IRS suggests filing electronically with direct deposit, as it is the fastest and easiest way to file and receive a refund. To avoid delays in processing, people should avoid filing paper returns wherever possible.
Dates of Tax Season
- January 23, 2023: Beginning of the 2023 tax season when the IRS begins accepting and processing 2022 tax year returns
- January 27, 2023: Special day to encourage people to understand the important benefits of the Earned Income Tax Credit (EITC)
- April 18, 2023: Filing deadline to submit 2022 tax returns or an extension to file and pay tax owed for most taxpayers
- October 16, 2023: Deadline for taxpayers requesting an extension to file their tax returns
In conclusion, the 2023 tax season has already begun on Monday, January 23, 2023, when the IRS will start accepting and processing tax returns for the 2022 tax year. The IRS has taken additional steps to improve its services to taxpayers, and taxpayers are encouraged to review their tax situation carefully to ensure they don’t overlook important tax credits they may be eligible for. Taxpayers should file electronically with direct deposit to speed refunds and visit IRS.gov for common questions and to check on the status of their refunds.