You file an income tax return to report your income and deductions. If you paid more tax than you owe through withholding, you get a refund, and if you paid less you owe the difference.
Steps
- Gather your income documents: W-2, 1099, and others.
- Choose standard or itemized deductions.
- Calculate your tax and subtract credits and withholding.
- File by April 15 (or the next business day).
Refund or owe
If withholding exceeds your tax, you get a refund. If not, you pay the balance.
File free
IRS Free File for incomes under $84,000 (2024).
Extension
Form 4868 extends filing to October 15 but not payment.
Who must file
In 2024, single filers under 65 generally had to file a federal return if their gross income was at least 14,600 dollars (the standard deduction). Self employed individuals must file if net earnings are 400 dollars or more. Filing may also be beneficial if you had taxes withheld and want a refund, or to claim credits such as the Earned Income Tax Credit.
Documents you need
- W-2 from employers.
- 1099 forms for freelance income, interest, dividends and unemployment.
- Form 1098 for mortgage interest and student loan interest.
- Records of deductible expenses, charitable donations and childcare.
- Last year’s tax return.
- Social Security numbers for yourself and dependents.
- Bank account details for direct deposit.
Deadline
The deadline is usually April 15. If it falls on a weekend or holiday, it moves to the next business day. File Form 4868 for an automatic extension to file until October 15, but taxes owed are still due by April 15.
Steps
- Gather documents.
- Choose standard deduction or itemize.
- Calculate taxable income and tax.
- Subtract withholding and credits.
- Get a refund or pay the balance.
Penalties
Late filing penalty is 5% of unpaid taxes per month, up to 25%. Late payment penalty is 0.5% per month.
Free filing
IRS Free File is available for taxpayers with adjusted gross income under a threshold (79,000 dollars for 2023 returns). The IRS Direct File pilot also offers free filing in participating states. Volunteer Income Tax Assistance (VITA) offers free help to people earning generally about 67,000 dollars or less.
Refunds
The average refund in 2024 was about 3,100 dollars, according to the IRS.
Amend
File Form 1040-X to correct an error within 3 years.
Common forms and credits
Most US individual filers use Form 1040. Taxpayers choose the standard deduction or itemize. For tax year 2024 the standard deduction was 14,600 USD for single filers and 29,200 USD for married couples filing jointly. Credits reduce tax owed directly, such as the Child Tax Credit and Earned Income Tax Credit, while deductions reduce taxable income. Employees receive Form W-2 and independent contractors receive Form 1099-NEC if paid 600 USD or more by a client (this threshold has been revised for later years, so check the current figure).
Withholding and payment
Employers withhold income tax from paychecks based on Form W-4. If too much is withheld, you get a refund. If too little, you pay the difference, and self employed workers usually pay quarterly estimated taxes. The IRS can set up payment plans for those who cannot pay in full. Keep records for at least three years.
Based on data from the Internal Revenue Service
