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Ahead of the 2022 tax season, the IRS has urged all Americans to file their 2021 tax returns online and as soon as possible to avoid delays in processing and receiving any refund they’re owed.
“Planning for the nation’s filing season process is a massive undertaking, and IRS teams have been working non-stop these past several months to prepare,” said IRS Commissioner Chuck Rettig in a Monday statement. “The pandemic continues to create challenges, but the IRS reminds people there are important steps they can take to help ensure their tax return and refund don’t face processing delays.”
The agency reiterated that there are no plans to extend the filing deadline of April 18. It also announced it will start to accept 2021 tax returns on Jan. 24.
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The average tax refund in 2020 was more than $2,800, according to the IRS. This year, the agency expects more than 160 million individual tax returns to be filed during the season.
What to know about delays
The agency has a few tips for people to aid a smooth tax season, including filing electronically, using direct deposit and making sure you have all applicable letters from the IRS before submitting your return.
“Filing electronically with direct deposit and avoiding a paper tax return is more important than ever this year,” said Rettig.
The IRS Free File program, which is available to taxpayers who made $73,000 or less in 2021, will open on Jan. 14, the agency said. In addition, many other tax-filing software programs will be available for people to use for the Jan. 24 start of the season.
Those who received an economic impact payment or the advance child tax credit last year should be extra-careful before filing, Rettig said. The IRS is sending out letters to recipients in January that should be used to accurately prepare returns.
“People should make sure they report the correct amount on their tax return to avoid delays,” said Rettig. The IRS anticipates that most taxpayers who file electronically, choose direct deposit and have no issues with their tax return will receive their refund within 21 days.
Now is the time to ask for help
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Of course, many Americans won’t have the paperwork they need to file their taxes until the end of January. Still, they should start gathering the materials they can now and decide if they might want to enlist professional help to file this year.
“If you are seeking the help of a professional tax preparer or a CPA to file your taxes, they may be super-bottlenecked [in April],” said Sheneya Wilson, CPA and founder of Fola Financial in New York.
Those seeking help from the IRS itself should look at the agency’s online resources before calling. During last year’s filing season, calls to the IRS were four times higher than in an average year.
“Our phone volumes continue to remain at record-setting levels,” Rettig said. “We urge people to check IRS.gov and establish an online account to help them access information more quickly.”
Things to collect
There are a few things people can do now to prepare. Start by looking over your 2020 tax return, experts say. That will give you a guideline of what you needed to file last year, which is a good place to start.
Generally, you need to gather any W-2s from last year or 1099 forms, if you’re an independent contractor, freelance or have a side hustle.
Those who had any period of unemployment in 2021 should look for a Form 1099-G, which will be sent to them from their state unemployment department. They should be prepared to pay taxes on those benefits, as well. Unlike in 2020, there is no tax break for people who got unemployment benefits this year.
