IRS announces the official start of tax season – and when it will start accepting 2023 returns

The Internal Revenue Service (IRS) announced Monday, January 29 as the official start of this year's tax season – the date it will begin accepting 2023 returns.

The IRS said it expected more than 128.7 million tax returns would be filed by the April 15 tax deadline this year.

The announcement comes as the agency undergoes a massive overhaul in an effort to improve its technology and customer service processes with funding allocated through the Biden administration's Inflation Reduction Act.

“As our transformation efforts bear fruit, taxpayers will continue to see marked improvement in IRS operations this coming tax season,” Commissioner Danny Werfel said in a news release.

“IRS staff are working hard to ensure new funding is used to help taxpayers by making the process of preparing and filing taxes easier.”

For many people, tax season can be daunting, bringing questions about deadlines and deductions.

Since last year's tax season, the Internal Revenue Service (IRS) has made some changes to credits and deductions, so it's important to be aware of these so you know what you may qualify for.

It is a remarkable new system introduced this year Instant file pilot program, allowing select taxpayers in specific states to prepare and file their taxes directly with the IRS this year.

The pilot is currently open to eligible taxpayers in twelve states: Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming.

The agency said qualified Americans must also report certain types of income, credits and deductions.

“Initially the Direct File pilot will only be open to a small group of taxpayers, later in the filing season we will open the Direct File pilot to more people to file their 2023 tax returns,” the IRS website said .

Taxpayers who need additional time can request an extension of the April 15 deadline, giving them until mid-October to file.

Taxpayers in Maine and Massachusetts have until April 17 to file due to the Patriot's Day and Emancipation Day holidays in those states.

“Taxpayers will continue to see marked improvement in IRS operations this coming tax season,” Commissioner Danny Werfel (pictured) said in a news release.

Agency leadership says more drop-in centers will be open this year to assist taxpayers, enhanced paperless processing will assist with IRS correspondence and enhanced individual online accounts will be available to taxpayers.

In previous years, the IRS faced huge backlogs of paper tax returns.

In June 2022, the agency was faced with more than 21 million delinquent paper tax returns, with National Taxpayer Advocate Erin Collins stating at the time, “The math is daunting.”

Now, with more funding, the IRS is hoping for a smoother filing season with fewer backlogs.

Taxpayers can expect most refunds to be issued within 21 days, the agency said.

Last year, out of more than 160 million returns filed, the IRS issued nearly 105 million refunds, with an average payout of $3,054, according to filing statistics.

It comes after experts warned it could be worth waiting to file returns until lawmakers finish negotiating two specific tax breaks.

Republicans want to restore some of Donald Trump's controversial 2017 tax cuts that benefit businesses, while Democrats are willing to negotiate in exchange for one of their priorities: bigger tax credits for children.

A bipartisan group of lawmakers, including Senate Finance Committee Chairman Ron Wyden and House Ways and Means Chairman Jason Smith, are negotiating a $100 billion bill.

If the bill passes by the end of the month, Americans could take advantage of the credits before filing taxes.

“Discussions are ongoing and we continue to make progress,” Ryan Carey, a Wyden spokesman, wrote in an email to The Washington Post.

“There is optimism on all sides, and the goal remains to get this done in time for the changes to the child tax credit to take effect in the coming filing season.”