For the 2015 income tax filing season, here is some important information that you will need to prepare your return. The list summarizes a number of common questions. Additional research may be needed to determine the degree to which each question applies to your personal situation.
What are the key dates for the 2015 tax season?
The key dates for the 2015 tax season, along with other key tax dates in 2016, include:
- January 15, 2016 – Last federal income tax estimate due for the 2015 tax year
- April 15, 2016 – First quarter federal income tax estimate due for the 2016 tax year
- April 18, 2016 – Deadline for filing 2015 Individual Income Tax returns (This is NOT a typo. There is a federal holiday on Friday, April 15, making tax day the following Monday.)
- April 18, 2016 – Last day to make a 2015 IRA contribution (Keogh and SEP contributions can be made as late as October 17, 2016, if you file for an extension)
- June 15, 2016 – Second quarter federal income tax estimate due for the 2016 tax year
- September 15, 2016 – Third quarter federal income tax estimate due for the 2016 tax year
- October 17, 2016 – Extended individual income tax return due
Who needs to file taxes?
Whether or not you need to file an income tax depends mostly on your income. However you will want to file if you have a refund coming.
Income thresholds requiring you to file are as follows:
- Single, under 65 – $10,300
- Single, 65 or older – $11,850
- Married filing jointly, both spouses under 65 – $20,600
- Married filing jointly, one spouse 65 or older – $21,850
- Married filing jointly, both spouses 65 or older – $23,100
- Married filing separately, any age – $4,000
- Head of household, under 65 – $13,250
- Head of household, 65 or older – $14,800
- Qualifying widow(er) with dependent child, under 65 – $16,600
- Qualifying widow(er) with dependent child, 65 or older – $17,850
What if I don’t get a w-2 or 1099?
There is a five-step process you can follow:
- Contact your employer or the issuer of the 1099; it may have been delayed or an oversight.
- Contact the IRS (800-829-1040) for assistance if you do not receive your W-2 by February 14th.
- File your return using Form 4852, Substitute for Form W-2, Wage and Tax Statement. In the case of a missing 1099 or W-2, use your best estimate of the actual numbers.
- File an extension to get more time to obtain your W-2 or 1099.
- Be prepared to file Form 1040X, Amended U.S. Individual Income Tax to correct any differences in the numbers reported.
How long will it take to get my refund?
If you file your return electronically, the refund is generally processed within 21 days of the e-file acceptance date. If you file a paper return, it will generally happen within six to eight weeks.
What if I can’t pay taxes owed?
First, don’t panic – you do have payment options. We’ve covered this topic in some detail, but here is the short version.
Your first option is to request additional time to pay. This will provide you with up to 120 days of additional time. The second option is to request an Installment Agreement, which will enable you to pay your balance in as long as 72 months.
There will be penalties and interest in either case, but they will be lower with the additional time to pay option than under the installment agreement.
How do I file my return online?
You can file your return for free directly with the IRS (just keep in mind that free e-filing may not exist with your state return). And if you use a paid tax preparer or one of the popular tax software tax programs, there is almost always an option to e-file, though there will be a small fee in most cases.
What is the personal exemption amount for 2015?
The personal exemption is $4,000 for 2015, up from $3,950 in 2014.
Should I itemize or take the standard deduction?
This is really a math question. The IRS provides standard deductions for taxpayers. If your itemized deductions exceed this amount, you should itemize.
The standard deductions for the 2015 tax year are:
- Married filing jointly and surviving spouses – $12,600
- Heads of household – $9,300
- Single, or married filing separately – $6,300
For a more detailed discussion please see Should You Use The Standard or Itemized Deduction on Your Taxes?.
What special deals are available for the military?
This section is just a reminder that special deals are available for military personnel, and you can see a discussion of this at the IRS website. But here’s a summary of the benefits that are available:
- Deadline extensions
- Combat pay exclusions
- Earned income tax credit (EIC)
- Moving expense deduction (for changing stations)
- Uniform deduction, for keeping up uniforms
- Signing joint returns in a military person’s absence
- Reservist travel deductions
- Non-taxable ROTC Allowances – educational and subsistence allowances paid to ROTC students participating in advanced training are not taxable
- Job hunting and moving expense deductions incurred in connection with transitioning to civilian life
- Free tax help
What’s the latest I can make a retirement contribution?
As mentioned earlier, the last day to make a 2015 IRA contribution is April 18, 2016. But contributions to Keogh and SEP plans can be made as late as October 17, 2016 if you file for an extension.
Contributions to employer sponsored plans, such as 401(k) and 403(b) plans, had to be made by December 31, 2015.
How much is the mileage allowance?
There are several mileage allowances, including:
- Business mileage – 57.5 cents per mile
- Charitable mileage – 14 cents per mile
- Medical and moving mileage – 23 cents per mile
What is the income threshold for the kiddie tax?
If your child is under the age of 19 or a full-time student under the age of 24, the amount of unearned income that is not subject to the kiddie tax is:
- First $1,050 – no tax due
- Next $1,050 – income taxed at the child’s rate
- Over $2,100 – income taxed at parent’s tax rate
At what income level does the Alternative Minimum Tax (AMT) apply?
The AMT was established to prevent tax payers from avoiding income tax through the use of certain tax deductions and imposes a tax in addition to the regular income tax.
The AMT applies beginning at the following income thresholds:
- Married filing jointly and surviving spouse – $83,400, less 25% of AMT income greater than $158,900
- Single – $53,600, less 25% of AMT income greater than $119,200
- Married filing separately – $41,700, less 25% of AMT income greater than $79,450
What types of income does the net investment income tax apply to?
The net investment income tax is the 3.8% Medicare tax that was enacted as part of the 2010 health care reform bill (Affordable Care Act) and became effective for the first time in 2013.
It adds a 3.8% tax on all investment income once your adjusted gross income (AGI) exceeds the following levels:
- Married filing jointly – $250,000
- Married filing separately – $125,000
- Single – $200,000
- Head of household – $200,000
- Qualifying widow(er) with dependent child – $250,000
Once your AGI exceeds these thresholds, the net investment tax will apply to income from rents, royalties, interest, dividends, capital gains, annuities, and any passive income from a trade or business.
This list is just a thumbnail version of the requirements for the 2015 income tax filing season. Please review each category carefully to discover whether or not it applies to your given situation.Topics: Taxes