As the 2025 tax filing season approaches, the IRS encourages taxpayers to take proactive steps to ensure a smoother, stress-free experience when filing their 2024 federal income tax returns. With enhanced digital tools and updated guidelines, here’s what you need to know to get ready.
IRS Online Account: Your Tax Hub
An IRS Online Account can simplify tax season and safeguard your tax information. By signing up, you can:
- View details from your most recent tax return, including your adjusted gross income.
- Request an Identity Protection PIN (IP PIN).
- Access account transcripts and wage/income records.
- Sign tax documents, such as powers of attorney.
- Manage payments, view balances, and adjust payment plans.
- Receive and view over 200 IRS electronic notices.
Tip: If you’re unable to create an online account, visit a Taxpayer Assistance Center for in-person authentication.
Get an IP PIN for Added Security
The Identity Protection PIN is a six-digit number that protects you from tax-related identity theft. For the 2025 tax season, the IRS has introduced a new process: returns with duplicate dependent claims will now be accepted if the primary taxpayer includes a valid IP PIN, expediting refunds in these cases.
How to Apply: The best way to obtain an IP PIN is through your IRS Online Account. For alternative options, visit the IRS website.
Key Deadlines and Changes for 2025
Quarterly Estimated Payments
Taxpayers with non-wage income (e.g., self-employment, digital assets) should note that the final quarterly estimated tax payment for 2024 is due on January 15, 2025. Use the Tax Withholding Estimator on IRS.gov to avoid surprises.
Form 1099-K Reporting
Taxpayers who received more than $5,000 via payment apps or online marketplaces in 2024 will receive a Form 1099-K in January 2025. Remember:
- All income, including earnings from side jobs or selling goods, is taxable, even without a 1099-K.
- Good recordkeeping is essential to accurately report income and avoid filing errors.
Digital Asset Reporting
Taxpayers involved in digital asset transactions (e.g., cryptocurrency, NFTs) must report all related income on their 2024 tax returns. Be ready to answer whether you received, sold, or disposed of any digital assets during the year. Maintain records showing the fair market value of your transactions in U.S. dollars to ensure accuracy.
Timing Your Refund
Most refunds are issued within 21 days of filing electronically with direct deposit. However:
- Refunds claiming the Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC) are held until mid-February under the PATH Act.
- Factors such as errors, missing information, or potential identity theft can delay processing.
Organize Your Tax Documents
Start gathering these key documents now to streamline filing:
- Income forms: W-2, 1099-NEC, 1099-MISC, 1099-K, etc.
- Investment records: Digital asset transactions or other capital gains/losses.
- Other documents: Receipts for deductions, proof of charitable contributions, and any tax-related correspondence.
Proper organization reduces errors and speeds up processing.
File Electronically for a Faster Refund
Filing electronically with direct deposit is the fastest way to receive your refund. If you don’t have a bank account, explore resources like the Credit Union Locator Tool or Veterans Benefits Banking Program for options. Refunds can also be deposited onto prepaid debit cards or through apps like PayPal, provided you have routing and account numbers.
Explore Free Filing Options
The IRS offers several no-cost filing services:
- IRS Free File: Access free tax software for federal returns.
- Direct File: Eligible taxpayers can file their federal return directly with the IRS.
- Volunteer Programs: Low-income taxpayers, older adults, and military members may qualify for free assistance through VITA or TCE programs.
Visit the IRS Get Ready Page
The IRS’s Get Ready page on IRS.gov provides tools, tips, and updates to help you prepare for filing. Taking action now can reduce stress and ensure a smoother tax season.
Plan Ahead for Tax Season 2025 Whether it’s setting up an IRS Online Account, applying for an IP PIN, or organizing your documents, early preparation makes tax season easier. Stay informed and proactive to maximize your refund and avoid unnecessary delays.
