The IRS asks taxpayers to prepare in advance for filing their 2024 federal income tax returns as tax filing season 2025 closes in. Taxpayers now have ways to take proactive steps to simplify the entire process and keep their tax data safe through improved digital tools and services.
There are tips and practical resources on the IRS’s Get Ready page on IRS.gov, including updates and key steps to simplification for tax filing in 2025. Preparing months ahead of time can help with cutting back on tension, precluding mistakes, as well as hastening returns. Here are some important updates and tools to consider as you prepare for the tax season.
Key tools and updates for 2025 filing
Benefits of an IRS Online Account
Setting up an IRS Online Account is a smart move to simplify tax season. With this account, taxpayers can:
- View key details from their most recent tax return, such as adjusted gross income.
- Obtain account transcripts, including wage and income records.
- Sign important tax forms electronically.
- Manage language preferences and receive over 200 types of IRS electronic notices.
- Set up payment plans, make payments, and track balances.
It also gives access to users who would like to apply for an Identity Protection PIN, otherwise called an IP PIN. The IP PIN generates a 6-digit code that protects the taxpayer from unauthorized, fraudulent tax claims. The new inclusion in the 2025 season directs that taxpayers would also be able to enter an active IP PIN on returns made, although another has claimed a dependent. It is aimed at speeding up refunds for duplicate returns of dependents. Taxpayer Assistance Centers also provide in-person authentication options for people who cannot create online accounts.
Updates to 1099-K reporting
Taxpayers whose online platforms or payment applications make transactions exceeding $5000 in goods and services within 2024 will receive a Form 1099-K by January of the next year, 2025, from their respective such sites or applications. All income—including that which does not appear on a Form 1099-K—is, according to the IRS, fully taxable and required to be reported.
The taxpayers have the responsibility of keeping good records for accurate reporting and dealing with discrepancies in case one receives a wrong 1099-K. With proper documentation, filing will be made easier, and needless delays will be avoided.
Read more: 401k contribution boost for 2025: here are the new limits.
Special considerations for digital assets and refund timing
Reporting Digital Assets
If you engaged in digital asset transactions in 2024, you’re required to report them on your federal tax return. Digital assets include cryptocurrencies, stablecoins, and non-fungible tokens (NFTs). Taxpayers should keep detailed records of all transactions, including purchase, sale, or exchange details, and the fair market value of assets at the time of receipt or disposition.
When filing, taxpayers must answer whether they engaged in any digital asset transactions during the year. Accurate reporting of income, capital gains, or losses is essential, and additional guidance is available on the IRS’s digital assets landing page.
Read more: Filing your tax return on IRS – Here’s how to avoid the most common mistakes that cause big problems.
Refund Timing and Avoiding Delays
Even so, the majority of refunds would normally be within 21 days, but this may not be the case if there are errors, missing information, or indications of identity theft. Refunds from returns claiming the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) cannot be issued until mid-February under the PATH Act.
Electronic filing and choosing direct deposit is a very fast way to receive your refund. If you don’t have a bank account, these sites might help you find one through the Veterans Benefits Banking Program, Credit Union Locator, or institutions insured by the FDIC.
Final preparations: Organize and file
To ensure a smooth filing process, gather all necessary documents, such as W-2s, 1099s, and records of digital asset transactions. Consider free filing options like IRS Free File or volunteer-assisted programs for eligible taxpayers, including seniors and military members.
With thoughtful preparation, taxpayers can navigate the upcoming season with ease and confidence.
