Tax season is upon us, and with the IRS now accepting returns since January 27, 2025, millions of Americans are gearing up to file their taxes. According to CBS News, it's estimated there will be around 140 million returns filed this year, all before the looming April 15 deadline. Many taxpayers eagerly await their refunds, with the average amount reported around $3,100, often viewed as a significant financial boost for the year, helping with everything from catching up on bills to putting down payments on big purchases.
The IRS provides the “Where’s My Refund?” tool via the IRS2Go mobile app which gives real-time updates on the status of refunds. Taxpayers can expect to see information about their 2024 tax returns just 24 hours after filing electronically. Those opting for paper returns, on the other hand, might wait about four weeks before testimonials appear through the app. Users of the IRS2Go app need to enter their Social Security or individual taxpayer ID number (ITIN), filing status, and the exact refund amount from their 2024 tax return to track their refund status.
Bob Jones, IRS spokesperson, shared with CBS News, "The IRS aims to streamline the process this year, ensuring taxpayers have real-time access to their refund status to help manage their finances more effectively." Given the fast pace of life, staying informed about these updates is more important than ever.
For those who filed electronically, refunds are typically issued within 21 days, provided there are no issues with the return. For example, if someone files their 1040 on January 27, they might see their funds deposited as early as February 17. If you filed your return with the Free File service, which opened on January 10 for individuals with adjusted gross income not exceeding $84,000, even quicker refunds could be expected—often by January 31.
So, what can delay your tax refund? Whether filing electronically or via paper, certain factors could result in slower processing. The IRS has noted additional workers might be necessary to handle the influx of paper returns. Other common causes of delays include claiming the Earned Income Tax Credit and the Additional Child Tax Credit. According to IRS guidelines, refunds related to these credits won’t be released before mid-February due to statutory regulations.
Adding another layer to this year's filing process, the IRS has also announced new tax brackets for 2025. While many taxpayers will feel fine about their 2024 returns, knowing these upcoming changes can help with future planning. The adjustments, made to counter inflation, feature only a 2.8% increase, the smallest over several years, and highlight the continued efforts to shield taxpayers from bracket creep—an issue where cost-of-living increases push taxpayers to higher rates without any real increase in purchasing power.
Single filers will face the following rates for 2025: 10% on income up to $11,925; 12% from $11,926 to $48,475; 22% from $48,476 to $103,350; and so on, with the highest tier at 37% for incomes above $626,350. For married couples filing jointly, the brackets are similarly adjusted, offering opportunities for potential savings.
Alongside the adjusted brackets, the IRS has raised the standard deduction to $15,000 for single filers and $30,000 for those married filing jointly. This change simplifies the filing process significantly. For those who do not have itemized deductions exceeding these amounts, they can now reduce their taxable income directly against these new thresholds without the burden of gathering paperwork.
The changes also impact the Alternative Minimum Tax with Exemption amounts adjusted for inflation, and the Earned Income Tax Credit for families with qualifying children has risen to $8,046, providing additional financial support for low- to moderate-income families.
Tax tips for making the most of the 2025 tax season include reviewing your W-4 withholding to correctly align your tax burden with these new brackets, maximizing contributions to retirement accounts, and optimizing any charitable donations. These proactive steps can create more space within one’s financial plan moving forward.
With tax season now underway, and with major adjustments to both tax brackets and deduction amounts, 2025 could be the year taxpayers see significant benefits if they’re informed and proactive. Staying updated on changes, preparing thoroughly, and utilizing tools like the IRS2Go app can help guarantee not just compliance but potential financial rewards come refund time.
Taxpayers are reminded to keep track of key deadlines, be aware of the new tax rates when filing, and utilize resources from the IRS to navigate any uncertainties. The importance of being informed cannot be overstated, especially with tax refunds providing some households with their largest financial windfall annually.