It’s the least wonderful time of the year – tax season! And unlike previous years during the COVID pandemic, there will be no extended deadline this year. Most taxpayers will need to file a federal, state, and local income tax return in order to remain on the up and up with the IRS, although there are a few exceptions in certain states. Taxes are a burden, but missing important deadlines can result in penalties and fines. Here are the important tax deadlines for 2022.

Federal Income Tax Deadline

Federal tax day is always April 15th, unless that date happens to fall on a weekend or federal holiday. For the last two years, the COVID-19 pandemic disrupted both personal and business finances across the nation. To reduce the burden on taxpayers, the government pushed back the income tax deadline in 2020 and 2021. There is no extension this year; taxes are due around the usual scheduled time for both W2 and 1099 employees.

We say usual scheduled time because there is a minor extension this year. Federal income taxes will be due on Monday, April 18th for the 2021 filing year. Since Good Friday falls on April 15th this year, the income tax deadline moves to the following Monday to avoid the federal holiday and weekend dates. This is the last day you can file your income taxes and not be considered late. If you’re seeking an extension on your federal income tax return, you must submit your request by April 18th.

There are exceptions to this deadline in two states: Maine and Massachusetts. Since these states observe the Patriots Day holiday (which always falls on the Monday after tax day) federal income taxes in these states can be filed on Tuesday April 19th without being considered late.

What happens if you miss the deadline? If you’re owed a tax refund, not much will happen if you miss the deadline. It’ll just take longer to receive your refund. If you file for an extension, you’ll receive your refund at a later date. But if you owe taxes? You could face penalties and fines if your obligation isn’t met by April 18th. Even if you’re filing for an extension, your taxes owed must be paid by April 18th or else a 0.5% late fee will be imposed each month that your payment isn’t made. Additionally, interest will be charged on the outstanding balance using the IRS’s formula based on the current federal funds rate.

What About State Taxes?

Most states follow the same April 18th deadline for income taxes owed at the state level, but not all. In fact, there are 7 states in the union that don’t require income tax filings at all. New Hampshire doesn’t require income tax on wages; however, capital gains from investments are still taxed and must be paid. The 7 states without income tax requirements are Florida, Texas, Alaska, South Dakota, Wyoming, Washington, and Nevada.

Not all states that collect income tax follow the federal tax deadline. For example, Delaware and Iowa this year will collect income taxes on May 2nd instead of April 18th. The longest gap between federal and state income tax deadlines belongs to Maryland, where state income filings aren’t due until July 15th.

Other Considerations

Tax-advantaged Accounts

April 18th is also the deadline for 2021 contributions to various retirement and tax-advantaged investment accounts. If you can contribute to a traditional IRA or Health Savings Account (HSA), you can continue to add funds to your account and write them off until April 18th. After April 18th, all IRA and HSA contributions will be counted toward the 2022 tax year.

Estimated Taxes

If you’re an independent contractor or 1099 employee, you don’t have taxes removed from your paycheck and must calculate your obligation yourself. If you’re a 1099 worker, you also must pay estimated taxes at the end of each quarter to meet your obligation. For the first quarter of 2022, estimated taxes are due April 15th. Estimated taxes will be due on the 15th of the month following the quarter end for each of the four quarters in the year. For example, Q2 ends on May 31 and estimated taxes for that period are due June 15th. The IRS expects at least 90% of all taxes owed to be paid each quarter, with the difference made up when federal income taxes are filed each April.

Work With an Experienced Financial Advisor

Our knowledgeable financial advisors at Good Life Financial Advisors of Mt. Pleasant are here to help you plan your investments. Contact us today to speak to our consultants and learn more about the tools and guidance we offer.

Disclosures

The opinions voiced are for general information only and are not intended to provide specific advice or recommendations for any individual.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.