News & Updates

Filers can visit the Get Ready webpage to find guidance on what’s new and what to consider when filing a 2022 tax return. They can also find helpful information on organizing tax records and a list of online tools and resources.

Get Ready by gathering tax records

When filers have all their tax documentation gathered and organized, they’re in the best position to file an accurate return and avoid processing or refund delays or receiving IRS letters. Now’s a good time for taxpayers to consider financial transactions that occurred in 2022, if they’re taxable and how they should be reported.

The IRS encourages taxpayers to develop an electronic or paper recordkeeping system to store tax-related information in one place for easy access. Taxpayers should keep copies of filed tax returns and their supporting documents for at least three years.

Before January, taxpayers should confirm that their employer, bank and other payers have their current mailing address and email address to ensure they receive their year-end financial statements. Typically, year-end forms start arriving by mail or are available online in mid-to-late January. Taxpayers should carefully review each income statement for accuracy and contact the issuer to correct information that needs to be updated.

Get Ready for what’s new for Tax Year 2022

With the end of the year approaching, time is running out to take advantage of the Tax Withholding Estimator. This online tool is designed to help taxpayers determine the right amount of tax to have withheld from their paycheck. Some people may have life changes like getting married or divorced, welcoming a child or taking on a second job. Other taxpayers may need to consider estimated tax payments due to non-wage income from unemployment, self-employment, annuity income or even digital assets. The last quarterly payment for 2022 is due on January 17, 2023. The Tax Withholding Estimator can help wage earners determine if there is a need to adjust their withholding, consider additional tax payments, or submit a new W-4 form to their employer to avoid an unexpected tax bill when they file.

As taxpayers gather tax records, they should remember that most income is taxable. This includes unemployment income, refund interest and income from the gig economy and digital assets.

Taxpayers should report the income they earned, including from part-time work, side jobs or the sale of goods. The American Rescue Plan Act of 2021 lowered the reporting threshold for third-party networks that process payments for those doing business. Prior to 2022, Form 1099-K was issued for third-party payment network transactions only if the total number of transactions exceeded 200 for the year and the aggregate amount of these transactions exceeded $20,000. Now a single transaction exceeding $600 can trigger a 1099-K. The lower information reporting threshold and the summary of income on Form 1099-K enables taxpayers to more easily track the amounts received. Remember, money received through third-party payment applications from friends and relatives as personal gifts or reimbursements for personal expenses is not taxable. Those who receive a 1099-K reflecting income they didn’t earn should call the issuer. The IRS cannot correct it.

Credit amounts also change each year like the Child Tax Credit (CTC), Earned Income Tax Credit (EITC) and Dependent Care Credit. Taxpayers can use the Interactive Tax Assistant on IRS.gov to determine their eligibility for tax credits. Some taxpayers may qualify this year for the expanded eligibility for the Premium Tax Credit, while others may qualify for a Clean Vehicle Credit through the Inflation Reduction Act of 2022.

Refunds may be smaller in 2023. Taxpayers will not receive an additional stimulus payment with a 2023 tax refund because there were no Economic Impact Payments for 2022. In addition, taxpayers who don’t itemize and take the standard deduction, won’t be able to deduct their charitable contributions.

The IRS cautions taxpayers not to rely on receiving a 2022 federal tax refund by a certain date, especially when making major purchases or paying bills. Some returns may require additional review and may take longer. For example, the IRS and its partners in the tax industry, continue to strengthen security reviews to protect against identity theft. Additionally, refunds for people claiming the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) can’t be issued before mid-February. The law requires the IRS to hold the entire refund – not just the portion associated with EITC or ACTC. This law helps ensure taxpayers receive the refund they're due by giving the IRS time to detect and prevent fraud.

For taxpayers who are still waiting for confirmation that last year’s tax return processed, or for a tax year 2021 refund or stimulus payment to process, their patience is appreciated. As of November 11, 2022, the IRS had 3.7 million unprocessed individual returns received this year. These include tax year 2021 returns and late filed prior year returns. Of these, 1.7 million returns require error correction or other special handling, and 2 million are paper returns waiting to be reviewed and processed. They also had 900,000 unprocessed Forms 1040-X for amended tax returns. The IRS is processing these amended returns in the order received and the current timeframe can be more than 20 weeks. Taxpayers should continue to check Where's My Amended Return? for the most up-to-date processing status available.

Renew expiring tax ID numbers

Taxpayers should ensure their Individual Tax Identification Number (ITIN) hasn’t expired before filing a 2022 tax return. Those who need to file a tax return, should submit a Form W-7, Application for IRS Individual Taxpayer Identification Number now, to renew their ITIN. Taxpayers who fail to renew an ITIN before filing a tax return next year could face a delayed refund and may be ineligible for certain tax credits. Applying now will help avoid the rush as well as refund and processing delays in 2023.

Bookmark the following tools on IRS.gov

Online tools are easy to use and available to taxpayers 24 hours a day. They provide key information about tax accounts and a convenient way to pay taxes. IRS.gov provides information in many languages and enhanced services for people with disabilities, including the Accessibility Helpline. Taxpayers who need accessibility assistance may call 833-690-0598. Taxpayers should use IRS.gov as their first and primary resource for accurate tax information.

• Let Us Help You page. The Let Us Help You page on IRS.gov has links to information and resources on a wide range of topics.
• Online Account. An IRS online account lets taxpayers securely access their personal tax information, including tax return transcripts, payment history, certain notices, prior year adjusted gross income and power of attorney information. Filers can log in to verify if their name and address is correct. They should notify IRS if their address has changed. They must notify the Social Security Administration of a legal name change to avoid a delay in processing their tax return.
• IRS Free File. Almost everyone can file electronically for free on IRS.gov/freefile or with the IRS2Go app. The IRS Free File program, available only through IRS.gov, offers brand-name tax preparation software packages at no cost. The software does all the work of finding deductions, credits and exemptions for filers. It‘s free for those who qualify. Some Free File packages offer free state tax return preparation. Those who are comfortable preparing their own taxes can use Free File Fillable Forms, regardless of their income, to file their tax return either online or by mail.
• Find a tax professional. The Choosing a Tax Professional page on IRS.gov has a wealth of information to help filers choose a tax professional. In addition, the Directory of Federal Tax Return Preparers with Credentials and Select Qualifications can help taxpayers find preparers in their area who hold professional credentials recognized by the IRS, or who hold an Annual Filing Season Program Record of Completion.
• Interactive Tax Assistant. The Interactive Tax Assistant is a tool that provides answers to many tax questions. It can determine if a type of income is taxable and eligibility to claim certain credits or deductions. It also provides answers for general questions, such as determining filing requirement, filing status or eligibility to claim a dependent.
• Where's My Refund? Taxpayers can use the Where’s My Refund? tool to check the status of their refund. Current year refund information is typically available online within 24 hours after the IRS receives an e-filed tax return. A paper return status can take up to four weeks to appear after it is mailed. The Where’s My Refund? tool updates once every 24 hours, usually overnight, so filers only need to check once a day.
• Volunteer Income Tax Assistance. The Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs offer free basic tax return preparation to qualified individuals.

Get refunds fast with Direct Deposit

Taxpayers should prepare to file electronically and choose Direct Deposit for their tax refund – it’s the fastest and safest way to file and get a refund. Even when filing a paper return, choosing a direct deposit refund can save time. For those who do not have a bank account, the FDIC website offers information to help people open an account online.

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How to set up a QCD

Any IRA owner who wishes to make a QCD for 2022 should contact their IRA trustee soon so the trustee will have time to complete the transaction before the end of the year.

Normally, distributions from a traditional individual retirement arrangement (IRA) are taxable when received. With a QCD, however, these distributions become tax-free as long as they're paid directly from the IRA to an eligible charitable organization.

QCDs can be made electronically, directly to the charity, or by check payable to the charity.

An IRA distribution, such as an electronic payment made directly to the IRA owner, does not count as a QCD. Likewise, a check made payable to the IRA owner is not a QCD.

Each year, an IRA owner age 70½ or over can exclude from gross income up to $100,000 of these QCDs. For a married couple, if both spouses are age 70½ or over and both have IRAs, each spouse can exclude up to $100,000 for a total of up to $200,000 per year.

The QCD option is available regardless of whether an eligible IRA owner itemizes deductions on Schedule A. Transferred amounts are not taxable, and no deduction is available for the transfer.

Report correctly

A 2022 QCD must be reported on the 2022 federal income tax return, normally filed during the 2023 tax filing season.

In early 2023, the IRA owner will receive Form 1099-R from their IRA trustee that shows any IRA distributions made during calendar year 2022, including both regular distributions and QCDs. The total distribution is in Box 1 on that form. There is no special code for a QCD.

Like other IRA distributions, QCDs are shown on Line 4 of Form 1040 or Form 1040-SR. If part or all of an IRA distribution is a QCD, enter the total amount of the IRA distribution on Line 4a. This is the amount shown in Box 1 on Form 1099-R.

Then, if the full amount of the distribution is a QCD, enter 0 on Line 4b. If only part of it is a QCD, the remaining taxable portion is normally entered on Line 4b.

Either way, be sure to enter "QCD" next to Line 4b. Further details will be in the final instructions to the 2022 Form 1040.

Get a receipt

QCDs are not deductible as charitable contributions on Schedule A. But, as with deductible contributions, the donor must get a written acknowledgement of their contribution from the charitable organization, before filing their return.

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There is no change to the taxability of income; the only change is to the reporting rules for Form 1099-K. As before, income, including from part-time work, side jobs or the sale of goods, is still taxable. Taxpayers must report all income on their tax return unless it is excluded by law, whether they receive a Form 1099-NEC, Nonemployee Compensation; Form 1099-K; or any other information return.

The IRS emphasizes that money received through third-party payment applications from friends and relatives as personal gifts or reimbursements for personal expenses is not taxable.

The American Rescue Plan Act of 2021 (ARPA) lowered the reporting threshold for third-party networks that process payments for those doing business. Prior to 2022, Form 1099-K was issued for third party payment network transactions only if the total number of transactions exceeded 200 for the year and the aggregate amount of these transactions exceeded $20,000. Now a single transaction exceeding $600 can trigger a 1099-K.

The lower information reporting threshold and the summary of income on Form 1099-K enables taxpayers to more easily track the amounts received.

Generally, greater income reporting accuracy by taxpayers also lowers the need and likelihood of later examination.

Consider making estimated tax payments

Income taxes must generally be paid as taxpayers earn or receive income throughout the year, either through withholding or estimated tax payments.

If the amount of income tax withheld from one's salary or pension is not enough, or if they receive other types of income, such as interest, dividends, alimony, self-employment income, capital gains, prizes and awards, they may have to make estimated tax payments.

If they are in business for themselves, individuals generally need to make estimated tax payments. Estimated tax payments are used to pay not only income tax, but other taxes as well, such as self-employment tax and alternative minimum tax.

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Highlights of changes for 2023

The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government's Thrift Savings Plan is increased to $22,500, up from $20,500.

The limit on annual contributions to an IRA increased to $6,500, up from $6,000. The IRA catch‑up contribution limit for individuals aged 50 and over is not subject to an annual cost‑of‑living adjustment and remains $1,000.

The catch-up contribution limit for employees aged 50 and over who participate in 401(k), 403(b), most 457 plans, and the federal government's Thrift Savings Plan is increased to $7,500, up from $6,500. Therefore, participants in 401(k), 403(b), most 457 plans, and the federal government's Thrift Savings Plan who are 50 and older can contribute up to $30,000, starting in 2023. The catch-up contribution limit for employees aged 50 and over who participate in SIMPLE plans is increased to $3,500, up from $3,000.

The income ranges for determining eligibility to make deductible contributions to traditional Individual Retirement Arrangements (IRAs), to contribute to Roth IRAs, and to claim the Saver's Credit all increased for 2023.

Taxpayers can deduct contributions to a traditional IRA if they meet certain conditions. If during the year either the taxpayer or the taxpayer's spouse was covered by a retirement plan at work, the deduction may be reduced, or phased out, until it is eliminated, depending on filing status and income. (If neither the taxpayer nor the spouse is covered by a retirement plan at work, the phase-outs of the deduction do not apply.) Here are the phase‑out ranges for 2023:

• For single taxpayers covered by a workplace retirement plan, the phase-out range is increased to between $73,000 and $83,000, up from between $68,000 and $78,000.
• For married couples filing jointly, if the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is increased to between $116,000 and $136,000, up from between $109,000 and $129,000.
• For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the phase-out range is increased to between $218,000 and $228,000, up from between $204,000 and $214,000.
• For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains between $0 and $10,000.

The income phase-out range for taxpayers making contributions to a Roth IRA is increased to between $138,000 and $153,000 for singles and heads of household, up from between $129,000 and $144,000. For married couples filing jointly, the income phase-out range is increased to between $218,000 and $228,000, up from between $204,000 and $214,000. The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains between $0 and $10,000.

The income limit for the Saver's Credit (also known as the Retirement Savings Contributions Credit) for low- and moderate-income workers is $73,000 for married couples filing jointly, up from $68,000; $54,750 for heads of household, up from $51,000; and $36,500 for singles and married individuals filing separately, up from $34,000.

The amount individuals can contribute to their SIMPLE retirement accounts is increased to $15,500, up from $14,000.

Details on these and other retirement-related cost-of-living adjustments for 2023 are in Notice 2022-55PDF, available on IRS.gov.

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While paper filing is available, the IRS strongly encourages e-filing. E-filing is the most secure, accurate method to file returns and saves taxpayers' time.

E-filing is easy with auto-populating forms and schedules with a step-by-step process that performs calculations for the employer.

The IRS acknowledges receipt of e-filed returns within 24 hours, giving taxpayers reassurance that their return was not misplaced or lost in the mail. E-file users also receive missing information alerts.

Two options to electronically file payroll tax returns

Employers can choose to self-file by purchasing IRS-approved software that meets their specific needs. There may be a fee to electronically file returns through the software, and the software will require a signature to e-file the returns.

Depending on the software they choose, taxpayers will have one or both of the following options:

• Apply for an online signature PIN
• Scan and attach Form 8453-EMP, Employment Tax Declaration for an IRS e-file Return, for the required signature.

The second option for employers is to hire a tax professional to prepare and file their employment tax returns. Taxpayers can use the Authorized IRS e-file Provider Locator Service to find a tax professional who can file on behalf of the business.

For more information on electronic filing of payroll tax returns, see the E-file Employment Tax Forms page.

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