By Anita Hamilton

With the opening of the 2025 tax season slated for Jan. 27, early birds are already starting to plan for the big day. If you'd like to be one of them -- and get your refund sooner -- that means everything from tracking your tax forms as they trickle in, to maxing out last-minute deductions, to deciding if you need to call in a pro to help out this year.

While taxes are inevitable, like this year's April 15 deadline, some things are new this filing season. Those include an expansion of the Direct File option, which enables taxpayers to file free directly to the Internal Revenue Service, to 25 states. That is more than double the 12 states where it was available last season. The option also allows for more complicated tax situations, such as claiming the child and dependent- care credit.

IRS Free File, which is available across all states and lets filers use commercial tax programs like TaxSlayer, is now available to anyone with an adjusted gross income of $84,000 or less. That is up from $79,000 or less last year.

The standard deduction, which is the amount of income you can shield from taxes if you don't itemize, also went up by 5%. For single people, it is now $14,600. Married people filing jointly can deduct $29,200, and heads of households can deduct $21,900.

It isn't too late to find ways to lower your tax bill, either. You have until tax day to contribute to a traditional IRA and have that money lower your taxable income.

The 2024 tax year limit is $7,000 if you are 49 or younger and $8,000 for those 50 or over. However, if you or your spouse are covered by a retirement plan at work, there are income caps for the IRA contribution to be fully deductible.

You also have until tax day to contribute to a health savings account to lower your taxable income, so long as you are also enrolled in an eligible, high-deductible health plan.

If you pay estimated quarterly taxes, there's still time to avoid late payment penalties. The deadline for fourth-quarter payments is Jan. 15.

Now is also a good time to start getting your tax documents in order. Begin by making a list of all expected income sources and check them off once you receive the necessary tax document. Employers are required to provide year-end W2s by Jan. 31. You should get tax forms on your investments in February, though some will come later.

If you think you'll need professional help this year, it isn't too early to reach out and set up an appointment for February or March. Things get tense the closer it gets to the deadline. When it comes to taxes, earlier is almost always better. Filing early can also help speed your refund. Most arrive in 21 days or less, according to the IRS.

Write to Anita Hamilton at anita.hamilton@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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January 10, 2025 16:19 ET (21:19 GMT)

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