Today, Phil discusses his top 5 tax tips for 2024.
Tax Tip #5: Gather Your Tax Documents Early
Most tax forms, including your W-2s and most 1099s, should be sent to you by January 31. However, there are some tax documents that come in a bit later. For example, 1099-B and 1099-MISC are due to recipients by February 15. 1095 health coverage forms are due by March 1. Be sure to wait for all your documents to arrive before filing your tax return.
Tax Tip #4: Don’t Forget About Estimated Tax Payments
If you are a small business owner, investor, landlord, or any taxpayer who receives income outside your normal job, you might need to pay estimated quarterly taxes. The 2024 quarterly tax payment deadlines are April 15, June 15, September 15, and January 15, 2025. Knowing these deadlines can help avoid tax penalties. You can use Form 1040-ES to calculate your estimated tax for the year.
Tax Tip #3: Don’t Wait on Your Tax Refund
In general, it takes about 21 days to receive your tax refund. However, some returns may take more time to review than others. That said, it’s best to not rely on your tax refund to make a big purchase or cover large expenses. You can use the online Where’s My Refund tool on the IRS’s website to track your refund status within 24 hours after e-filing and within 4 weeks of mailing a paper return.
Tax Tip #2: Report 1099-K Income – Even If You Don’t Receive the Form
If you receive payments on Venmo, PayPal, Etsy, eBay, or other third-party sites for your business, you probably know what a 1099-K is. The 1099-K reporting thresholds have changed quite a bit in the last couple of years, making the topic confusing for many small businesses. In short, if you receive income from these third-party payment networks, you must report it on your tax return, even if you do not receive a 1099-K form. This income is still considered taxable income, which means not reporting it can result in taxes owed to the IRS.
Tax Tip #1: Create an IRS Online Account
The IRS Online Account allows taxpayers to access various services and information related to their tax obligations. Taxpayers can access their tax return transcripts, make payments, access IRS notices and letters, apply for installment agreements, view payment histories, and more. Put simply, it helps you know where you stand with the IRS.
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