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Tax Season 2024: Get Prepared!


Important Dates for Crypto Investors to Keep in Mind

As of January 29, the 2024 tax filing season is officially underway, prompting millions of American taxpayers to gather their W-2s and 1099 and grapple with understanding the complexities and challenges of their tax filing.


Cryptocurrency investors are also challenged to accurately calculate their crypto gains to submit with their taxes. Not an easy task for most.

If you’re looking for assistance with crypto calculations or tax filing, talk to one of our experts to learn more about our services and get started. We’re here to help.


Bulletproof Return: 
The Tax Return Method That Can Save You Thousands

At CryptoTaxAudit, we prepare tax returns for people with a high risk of being audited by the IRS, particularly returns reporting digital asset income, foreign company ownership, and foreign asset investing.

We call our methodology a “bulletproof return.” A bulletproof return is the type of return that is optimized to save you money while being fully compliant to ensure it can withstand any IRS audit. Filing a bulletproof return reduces your risk of audit significantly. We have helped thousands of clients optimize their tax situation and remain fully compliant with tax authorities.

Date

Key 2024 Tax Deadlines for Individual and Business Taxpayers

October 15th

This is the due date for extended Forms 1040 and 1040-SR. Individuals who filed for an extension using Form 4868 must file their final tax return by this date.

FinCEN Form 114 FBAR if extended.

Extended Form 1120 (C-corporation) is due today.

October 31st

Form 941 (Q3 2024): Quarterly federal tax return for employers, reporting withheld income taxes, Social Security, and Medicare taxes.

December 16th

Form 1120-W - 2024 - estimated tax payment for corporations #4 for income from September 1 to December 31, 2024.

December 31st

Required minimum distributions for those who turned 73 in 2023 must be taken by this date. This is also the deadline for all other 2024 required minimum distributions.

2025

January 15th

Form 1040-ES - 2024 estimated tax payment for individuals #4 for income from September 1 to December 31, 2024.

January 31st

Form 941 (Q4 2024): Quarterly federal tax return for employers, reporting withheld income taxes, Social Security, and Medicare taxes.

Key 2024 Tax Deadlines for Individual and Business Taxpayers

September 16th

Extended Forms 1065 (partnership) and 1120-S (S-corporation) are due today. 

Schedules K-1, K2 and K-3 from extended passthrough returns are due to recipients.

Form 1040-ES - 2024 estimated tax payment for individuals #3 for income from June 1 to August 31, 2024.

Form 1120-W - 2024 - estimated tax payment for corporations #3 for income from June 1 to August 31, 2024.

October 15th

This is the due date for extended Forms 1040 and 1040-SR. Individuals who filed for an extension using Form 4868 must file their final tax return by this date.

FinCEN Form 114 FBAR if extended.

Extended Form 1120 (C-corporation) is due today.

October 31st

Form 941 (Q3 2024): Quarterly federal tax return for employers, reporting withheld income taxes, Social Security, and Medicare taxes.

December 16th

Form 1120-W - 2024 - estimated tax payment for corporations #4 for income from September 1 to December 31, 2024.

December 31st

Required minimum distributions for those who turned 73 in 2023 must be taken by this date. This is also the deadline for all other 2024 required minimum distributions.

January 2025

January 15th

Form 1040-ES - 2024 estimated tax payment for individuals #4 for income from September 1 to December 31, 2024.

January 31st

Form 941 (Q4 2024): Quarterly federal tax return for employers, reporting withheld income taxes, Social Security, and Medicare taxes.

Timely Compliance

Business and individual taxpayers must be aware that there are generally different deadlines to pay taxes and file. While filing deadlines come around once a year and can be extended for six months by filing the proper form, deadlines to pay tax for taxpayers who expect to owe or do not have withholding on their income are different. Taxpayers must be aware of the difference in due dates and amounts that must be paid to avoid penalties and interest.

Business and individual taxpayers must be aware that there are generally different deadlines to pay taxes and file. While filing deadlines come around once a year and can be extended for six months by filing the proper form, deadlines to pay tax for taxpayers who expect to owe or do not have withholding on their income are different. Taxpayers must be aware of the difference in due dates and amounts that must be paid to avoid penalties and interest.

Extension of Time to File vs Payment

Taxpayers With Withholding

Most individual taxpayers do not have to worry about making estimated tax payments to the IRS (and state tax authorities) since employers withhold the proper income taxes from employee’s wages. When you start a new job and fill out Form W4, you indicate the proper withholding amount based on your tax situation. If you are a W-2 employee and your only source of income is your job, and you owe taxes when filing your tax return, you are likely under-withheld, and you should have your employer increase your withholding. Read on if you owed tax due to crypto gains or any other income without withholding.

Taxpayers Without Withholding

If you are self-employed, a business owner, an investor, or a business taxpayer, you must make quarterly estimated tax payments to the IRS and state authorities throughout the year. This is because tax payments on all income are due as income is earned, and since you have no withholding on this income, you will have to remit these payments quarterly directly to the tax authorities. Refer to the key dates for Forms 1040-ES for individual taxpayers and 1120-W for corporations.

Avoiding Penalties and Interest

Taxpayers who did not pay enough tax throughout the year, whether through estimated tax payments, credits, or withholdings, can be charged penalties and interest on underpayments by the IRS. This will generally not apply to taxpayers owing less than $1,000 in tax or if they meet one of the two safe harbors below:

  1. The taxpayer paid 90% of the total expected tax for the current year, 2024 (this requires calculating a taxpayer’s expected taxes based on available information or estimates of income) or
  2. The taxpayer paid 100% of the total tax on the prior year's return. Subject to exceptions, taxpayers whose adjusted gross income for 2023 was more than $150,000 ($75,000 if the taxpayer filing status for 2023 is married filing separately) should substitute 110% for 100%.

Remember that the above are safe harbors of payments to be paid during the tax year to avoid underpayment penalties and interest. Any remaining tax not covered by the safe harbors above is due by the unextended due date. For example, if you met the 90% of the current year safe harbor by paying 90% of your tax throughout the year, you will not be subject to penalties but will still have to pay the remaining 10% of unpaid tax by the unextended due date. 

Frequently Asked Questions

Conclusion

While staying updated with tax deadlines and regulations is essential for all US taxpayers, considering the need for estimated payments and the amount of work needed to get good results, crypto investors must be especially diligent regarding tax deadlines. Preparing, planning, and making each payment timely will save investors significant last-minute headaches and hard-earned cash in the form of late filing penalties and interest. However, if you are late in filing, it is never too late to get compliant.

Schedule a consultation today if you need assistance with the current tax year or any prior tax years.