For people in the US, tax season means that most people will be filing their tax returns to report their income and ask for tax refunds. It is the law that if you make more than a certain amount, you have to file your income tax.
Also, if you want to get certain refunds or credits, you have to file your taxes even if you do not make enough money to meet the minimum income requirements. For those who just recently filed their taxes, they may be getting a tax refund this month.
Who must file their income tax?
In the US, your income tax rate is based on your gross income. There is no one flat rate of income tax. Instead, you pay the IRS a percentage of your income based on your tax bracket. The money you get from a job, running a business, investments, benefits, and other sources like prizes or the lottery is taxable income.
The IRS says that if you are under 65 and your gross income is more than $14,600, you must file a tax return as a single taxpayer. If you make less than this, you do not have to file a tax return. If you are single and over 65, and your gross income is more than $16,550, you need to file a tax return.
You may need a different amount of income if you are the head of the household, married and filing jointly, or a surviving spouse.
When to expect your tax refunds this month
The official IRS website says that once you file your tax return, you should not have to wait too long to get your tax refund, as long as you are eligible for one. Also, the time it takes to get your refund will depend on whether you filed your taxes online with an e-return or by mail.
You may also get extra tax rebates, like the Additional Child Tax Credit, which can change when you get your refund.
If you applied for the Earned Income Tax Credit or the Additional Child Tax Credit, you will get your refund by March 3 as long as you do the things below:
- Your return for the tax credits was filed online
- You indicated in your return that you would like to receive your refund by direct deposit
- There were no internal problems or inconsistencies with your return
This is usually how it works: most people get their tax refunds 10 to 12 days after filing their return. This quick turn around is only possible if you filed your taxes online and chose direct deposit as the method of payment. If you sent in your tax returns, you might have to wait up to four weeks to get your money back.
What to do if the IRS contacts you
The IRS will often call you during tax season if there are problems with your return. The IRS wants you to know that this is not a reason to worry and that their only goal in contacting you is to help you and them file your taxes correctly.
People often get scared when they get a letter or notice from the IRS and do not open it. The IRS wants you to read everything they send you in the mail carefully because that is the only way they will ever get in touch with you.
People who want to steal your money are waiting for tax season to come around. Make sure you only answer IRS letters that have been sent to you and are authorized to do so. You can call the IRS directly to find out if the message is real if you are not sure.