If you're eager to file your 2022 tax return in January or early February, the IRS has a warning: You'll need to wait for "key documents" before filing in 2023. Show
In a release last week, the IRS urged "early filers" to watch for Form 1099-K, which reports income for third-party payment networks such as Venmo or PayPal. "A little extra caution" could save time and effort, the agency said, because if you don't report 1099-K income, you may owe money and need to file an amended return. More from Personal Finance: "I would recommend waiting until at least the end of February or early March," said Albert Campo, a certified public accountant and president of AJC Accounting Services in Manalapan, New Jersey. His reasoning: The deadline for companies to send 1099-Ks is Jan. 31. That means tax filers should build in a little time to allow for slow or misdirected mail. If you've recently moved, for example, it's possible third-party payment networks still have your previous address on file and send 1099-Ks to the wrong place, he said. Why many more filers will receive 1099-KsExperts say many Americans will receive 1099-Ks for the first time in the upcoming tax season. Here's why: Before 2022, the federal Form 1099-K reporting threshold was more than 200 transactions worth an aggregate above $20,000. But the American Rescue Plan Act of 2021 slashed the threshold to just $600, and even a single transaction can trigger the form.
While the change targets business transactions, such as part-time work, side jobs or selling goods, it's possible some filers will receive 1099-Ks for personal transfers. The IRS urges filers to contact issuers "immediately" to fix errors or make adjustments on returns. "The diligence and accuracy of the 1099-K reporting under the new lower threshold remains to be seen," said Phyllis Jo Kubey, a New York-based enrolled agent and immediate past president of the New York State Society of Enrolled Agents. "I worry about self-preparing taxpayers who may not understand what's reported on their 1099-K and why," Kubey said, noting that reconciling has been challenging for years. "Now, that problem will affect more people." Why it's critical to have all tax forms before filingWhen filing your return, it's important to accurately report details from all tax forms, such as the W-2 from your job, 1099-NEC forms for contract work and 1099-G for unemployment income. Known as "information returns," these forms are sent to taxpayers yearly by employers and financial institutions to report taxable activity, with copies going to the IRS. Your tax return should match these forms, assuming the details are correct. When the IRS receives your income directly from reporting companies, the system automatically flags mismatching returns. That's why it's better to wait and include the correct details, experts say. Otherwise, you'll risk possible error notices and penalties later.  watch now VIDEO4:0604:06 Facing big losses in crypto? Here's how to ease your financial pain Squawk Box Kubey said it's easy to miss forms for investment income since many opt for paperless records. One way to double-check which forms the IRS has received is by logging into your online account to see your IRS transcripts, she suggested. "Unfortunately, the IRS doesn't publish taxpayer wage and income transcripts until later in the year," Kubey said. However, "those transcripts are a fantastic resource for checking for missed tax forms," including third-party payment reporting discrepancies, she said. Last year, Canadians filed almost 31 million income tax and benefit returns. Having the information you need on hand to file your return makes the filing process that much easier. We want to help you get ready, so you are in good shape when it comes time to file your return this year. Here you will find information on filing options, COVID-19 benefits, and what’s new for this tax-filing season. The tax-filing deadline for most individuals is April 30, 2022Since April 30, 2022, falls on a Saturday, your return will be considered filed on time in either of the following situations:
You have until June 15, 2022, to file your return if you or your spouse or common law-partner are self-employed. The payment deadline is April 30, 2022If you have a balance owing, your payment is due on April 30, 2022. If you or your spouse or common law-partner are self-employed, your payment is still due on April 30, 2022. Since April 30, 2022, falls on a Saturday, in both of the above situations, your payment will be considered paid on time if we receive it, or it is processed at a Canadian financial institution, on or before May 2, 2022. If you filed your 2020 return and qualified for interest relief, you have until April 30, 2022, to pay any outstanding income tax debt for the 2020 tax year to avoid future interest charges. This applies to the tax owing for the 2020 tax year only, and not for any previous tax year. Plan ahead this tax-filing seasonPlan ahead, and file your income tax and benefit return as soon as you can. Doing so will allow you to:
To help you plan ahead, we encourage you to sign up for direct deposit and to file online. Using these tools will help you avoid delays and get your notice of assessment (NOA) and any refund, if applicable, faster. Also, please sign up for My Account. It is the fastest and easiest way to view and manage your tax and benefit information. If you own a business, you can also sign up for My Business Account. Filing before the deadline is the best way to make sure your entitled benefit and credit payments are not interrupted. This includes the Canada child benefit, the goods and services tax / harmonized sales tax credit, and any related provincial or territorial benefits. Even if you owe tax, don’t risk having your benefits interrupted by not filing. If you cannot pay your balance owing, we can work with you on a payment arrangement. Our service standard is to issue your NOA within two weeks of receiving your return online. Due to COVID-19 delays, the Canada Revenue Agency (CRA) may take 10 to 12 weeks to process paper returns. The CRA will process them in the order they are received. Canadians who file online and who are signed up for direct deposit may get their refund in as little as eight business days. Go digital this tax-filing seasonGo digital this tax-filing season by using our online services such as:
Please note that it will be mandatory to provide an email address to use My Account as of February 2022. You can check out our questions and answers about filing your taxes page for more answers to common questions. This page will be updated periodically to incorporate changes that may affect you during the tax-filing season. Haven’t filed in a while or have never filed a return?You have to complete and file an income tax and benefit return every year to:
There are different ways to file your income tax and benefit return(s) if you:
You can go to our Get ready to do your taxes page. It has information on deadlines, and other tax tips that can be helpful for you. You can also get answers to frequently asked questions about filing your taxes at our Questions and answers about filing your taxes page. We can also help you Learn about your taxes. This year, we are launching a new online course to help you learn about taxes and empower you to do your taxes on your own. The free online course provides you with lessons that help you understand what taxes are, why we pay them, how to read your paycheques and income tax slips, and finally, how to do your taxes for the first time. Following each lesson, you can test yourself with exercises and quizzes. COVID-19 benefitsIf you received benefits issued by the CRA in 2021, such as the Canada Recovery Benefit, a T4A information slip will be mailed to you by the end of February 2022. Residents of Quebec will receive a T4A slip and an RL-1 slip. T4A information slips from the Government of Canada for COVID-19-related benefits will also be provided online if you’re registered for My Account and have full access. To have full access to My Account, you need to enter the CRA security code we issued to you after completing the first step of the registration process. You can view some tax slips online starting in early January in My Account. Information slips, including information for COVID-19-related benefits, are also available through the Auto-fill my return service in certified tax filing software. This service automatically fills in parts of an income tax and benefit return with information that the CRA has on file. To use the service, you must be registered for My Account. When COVID-19 benefits were paid, some tax was withheld at source. If you end up owing additional tax on top of that, we understand that payment could present significant financial hardship. In that case, our expanded payment arrangements could work for you. This will give you more time and flexibility to repay based on your financial situation. Also, taxpayer relief is available if you can’t meet your tax obligations because of circumstances beyond your control. The CRA may cancel or waive penalties or interest under certain conditions. There may be other effects to filing your return that are specific to any COVID-19 benefit you received, or if you’re a resident of Quebec. We are aware that everyone’s tax situation is unique and may require contacting one of our agents. We thank you for your patience in advance. Tax season is the busiest time for the CRA. Unfortunately, this means you may experience long wait times. Agents are working hard to answer calls as fast as possible to deliver services that Canadians expect from the CRA. We understand that waiting to get through in these situations can be stressful. The individual tax enquiries line is open Monday to Friday 8am to 8pm, local time, and Saturday 9am to 5pm, local time, except holidays. Protecting you from scams and fraudThe safety and security of Canadians, and their information, is a priority for the CRA. Being a victim of scams, fraud, or identity theft can result in significant financial and emotional effects. Know when and how the CRA might contact you. The Be Scam Smart page provides information on the ways in which the CRA may contact you, including by:
We also provide information on securing CRA accounts and encourage you to:
What’s new on the income tax and benefit returnCanada workers benefit – The Canada workers benefit rates and income thresholds have changed for 2021. A new “secondary earner exemption” has also been introduced. Climate action incentive payment – The Government of Canada has announced its intention to deliver the Climate action incentive (CAI) as a quarterly benefit payment. If you are a resident of Alberta, Saskatchewan, Manitoba, or Ontario, and you are eligible, you will automatically receive your CAI payments four times a year, starting in July 2022. To receive your payments, you have to file a tax return even if you have not received income in the year. You may qualify for the supplement for residents of small and rural communities if you currently reside outside of a census metropolitan area (CMA) and expect to continue to reside outside of a CMA on April 1, 2022. Home office expenses – You may be eligible to claim a deduction of up to $500 annually for home office expenses in the 2021 tax year using the temporary flat rate method, if you worked more than 50% of the time from home for a period of at least four consecutive weeks due to COVID-19. This method can also be used if your employer provided you a choice to work from home due to COVID-19 during this period. Zero-emission vehicles – The definition of zero-emission vehicle has changed for vehicles acquired after March 1, 2020. A vehicle may still qualify as a zero-emission vehicle if the vehicle was subject to a prior capital cost allowance or terminal loss claim provided that the vehicle was not acquired by the taxpayer on a tax-deferred “rollover” basis or previously owned or acquired by the taxpayer or a non-arm’s length person or partnership. Support for farmers – The Government of Canada outlined in Budget 2021 the objective of returning a portion of the proceeds from the price on pollution to farmers in jurisdictions that do not have a carbon pricing system. The designated provinces are currently Ontario, Manitoba, Saskatchewan and Alberta. For 2021, under proposed legislation, farmers who incur eligible farming expenses of $25,000 or more, which are all or partially attributable to designated provinces, may be able to receive a credit of $1.47 per $1,000 in eligible farming expenses. Educator School Supply Tax Credit – To support teachers and early childhood educators in Canada, the government proposes to expand and enrich the Eligible Educator School Supply Tax Credit to allow them to claim a 25 per cent refundable tax credit for purchases up to $1,000 on eligible teaching supplies bought during the tax year. The government also proposes to expand the list of eligible teaching supplies to include electronic devices such as graphing calculators, digital timers, and tools for remote learning. These enhancements would take effect starting with the 2021 tax year. Eligible educators, regardless of their income level, who buy teaching supplies may qualify for a refundable tax credit of up to $250 each year. Teaching supplies are consumable supplies such as crayons, glue and paper, as well as certain prescribed durable goods such as:
Northern residents deductions – You may live in a prescribed zone and be eligible to claim these deductions. To find out, visit Line 25500 - Places located in prescribed zones. The northern residents deductions are available to those who permanently live in a prescribed zone for a continuous period of at least six consecutive months, beginning or ending in the tax year. The residency deduction is based on how many days you lived in a prescribed zone during the tax year. When these changes take effect, the travel deduction is being expanded to be available to eligible northern residents who take a trip even if their employer does not provide travel benefits for personal travel. Eligible individuals living in a prescribed northern zone can claim the full amount of these deductions, and those living in a prescribed intermediate zone can claim 50% of these deductions. For more information, visit Northern Residents Deductions for 2021. What’s new with our servicesNotice of assessment or reassessment – In 2023, the CRA will start the process of switching to electronically providing a notice of assessment or reassessment. If you file your return using:
Note: First-time filers will receive a notice of assessment by mail regardless of how they file their first tax return. Your email address is required for My Account – Effective February 2022, as a fraud prevention initiative, it will be mandatory to provide an email address to access My Account. This will allow the CRA to inform taxpayers in real time of changes made to their account. Taxpayers will have the option to select if they would like to receive their CRA correspondence by paper mail, or to be notified by email, when CRA correspondence is available for viewing electronically in My Account. Multi-factor authentication has been added to your account – We have added multi-factor authentication for all users to help make our CRA sign-in services more secure! To ensure everyone can use it, we’ve introduced a new passcode grid option. File my Return – This service has been improved to include the use of a PIN. Users of the service who have a PIN and enter it will be able to find out their estimated refund or balance owing, as applicable. NETFILE and EFILE – NETFILERs filing a tax return with their current NETFILE access code will receive a new randomly-generated and unique code displayed on their notice of assessment for use on the following year’s (2022) tax return. This code will now change annually. Electronic filers using the EFILE service will be able to file a tax return for Canadians with a mailing address outside Canada. Users of the EFILE and NETFILE services will be able to file a current year tax return, in addition to returns for the four previous years, instead of just three. Auto-fill my return – This service will provide information for the current year, plus the previous five years instead of four. Automated callback service – When available, this service lets callers ask for a callback instead of waiting on hold. Callers on the individual tax enquiries, benefits enquiries, and business enquiries lines may be given the option of a callback. Keep in mind that this service will only be available at certain times of the day and when wait times reach a certain length. Community Volunteer Income Tax Program (CVITP) – If you have a modest income, a simple tax situation, and require assistance, a CVITP volunteer may be able to complete and file your tax returns for free. Services are currently being offered both in-person and through virtual means such as video-conferencing. To find a clinic, please visit our website. Should you live in Quebec, please visit the Income Tax Assistance – Volunteer Program for more information. T3 returns – This tax season, if you are filing any of these T3 returns (T3ATH-IND, T3RET, T3M, T3S or T3RCA), please note that you can do it online using EFILE. Register for EFILE today and file a T3 return electronically as of early March 2022. If you need a trust account number, visit our Trust Account Registration online service. T3 returns from previous years will not be accepted electronically at this time. |
When do taxes need to be filed 2022
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