The time it takes to complete your taxes can vary depending on your situation. Here’s an overview of how long it typically takes to file IRS tax returns.
According to the IRS, most taxpayers spend about 13 hours preparing their returns. Specifically, the IRS reports that nonbusiness taxpayers usually spend around 9 hours completing their taxes. However, for those filing business returns, the time needed increases significantly, averaging about 24 hours. These estimates account for time spent on record-keeping, tax planning, filling out forms, and submitting required documentation.
Keep in mind, these are just averages. Some people may take longer to file their taxes, while others might complete the process more quickly. Factors such as the complexity of your tax situation and your level of preparation can influence the time it takes.
How Long Does It Take to Complete Your Taxes?
Here’s a breakdown of the average time it takes taxpayers to prepare their tax returns, based on IRS data:
- All Taxpayers (100% of returns)
- Total Time: 13 hours
- Recordkeeping: 6 hours
- Tax Planning: 2 hours
- Form Completion & Submission: 4 hours
- Other: 1 hour
- Average Cost: $270
- Nonbusiness Taxpayers (72% of returns)
- Total Time: 9 hours
- Recordkeeping: 3 hours
- Tax Planning: 1 hour
- Form Completion & Submission: 3 hours
- Other: 1 hour
- Average Cost: $150
- Business Taxpayers (28% of returns)
- Total Time: 24 hours
- Recordkeeping: 12 hours
- Tax Planning: 5 hours
- Form Completion & Submission: 6 hours
- Other: 2 hours
- Average Cost: $560
The time spent on filing taxes is broken down into categories like recordkeeping, tax planning, form completion, and other tasks. Business taxpayers typically spend more time, while nonbusiness taxpayers require less time to file.
How Much Time Does It Take to Complete a Basic Tax Return?
The time it takes to complete a basic tax return can vary, depending on the forms used and whether or not the taxpayer has any business income. Typically, individuals who do not file business taxes will spend less time preparing their returns.
The IRS estimates that taxpayers who don’t file business returns generally spend around 9 hours on tax preparation. This time is broken down into 3 hours for recordkeeping, 1 hour for tax planning, 3 hours for completing and submitting forms, and an additional hour for miscellaneous tasks.
How Much Time Does It Take to File a Business Tax Return?
Taxpayers who run their own businesses typically spend significantly more time on tax preparation compared to those without business income. This category covers a wide range of taxpayers, including corporations and individuals with business income, such as earnings from rental properties or gig work.
According to the IRS, business taxpayers generally spend about 24 hours on tax preparation. This includes 12 hours for recordkeeping, 5 hours for tax planning, 6 hours for completing and submitting forms, and 2 additional hours for other tasks. On average, business taxpayers also incur the highest costs, spending around $560 on tax preparation.
Is Filing a Tax Return Difficult?
Preparing a tax return can be tricky, depending on how complicated your financial situation is. With tax laws constantly changing and the tax code often being overwhelming, it’s not always easy to figure out what forms to use, what deductions or credits apply, and how to comply with the latest regulations. This process requires a level of expertise that many people simply don’t have.
So, yes, filing taxes can be difficult—especially if you have complex financial circumstances. For individuals with intricate situations, seeking help from a tax professional like Austin & Larson Tax Resolution can make the process much easier and less stressful. Their expertise can guide you through the complexities and ensure your taxes are filed accurately.
However, if your tax situation is straightforward, you might find it manageable to prepare and file your return on your own. It’s all about knowing what applies to your specific situation.
How Can I Speed Up the Tax Filing Process?
A significant portion of the time spent preparing taxes is dedicated to recordkeeping. Since this is the most time-consuming task in the process, one of the best ways to reduce the time you spend on taxes is by maintaining accurate and thorough records throughout the year. Keeping organized and up-to-date tax records can save you time when it’s time to file, whether you’re handling your tax return yourself or working with a tax professional. Having accurate records is also essential if the IRS decides to audit you.
Another way to save time is by using tax preparation resources or enlisting the help of a tax professional. If you choose to work with a professional, such as Austin & Larson Tax Resolution, their expertise can streamline the process, ensuring accuracy and efficiency. Whether hiring a tax pro is the right choice depends on the complexity of your taxes, your comfort level with tax matters, and how much you value your time.
Why It’s Important Not to Wait Until the Deadline to File Your Taxes
Waiting until the last minute to file your taxes can lead to a lot of unnecessary stress and complications that could have been easily avoided with a little bit of planning. One of the main issues with rushing through the process is that you’re much more likely to make mistakes, which could result in costly errors or delays in processing your return. A hasty submission might also lead to missed opportunities for tax deductions or credits you might otherwise have claimed.
Beyond making errors, filing at the last minute leaves little time to handle any unexpected issues that may arise. You could realize that important documents are missing or encounter other problems that require immediate attention. Tax preparation, as this article outlines, is not a quick task—it requires time to gather, organize, and review all necessary documents, including income statements, deductions, and other relevant records. Without sufficient time, you may overlook important details, potentially causing bigger issues down the line.
Furthermore, if you miss the filing deadline and submit your tax return late, you’ll face penalties and interest charges that could add up quickly. The “Failure to File” penalty applies if you don’t file your tax return by the due date. If you are significantly late and owe taxes, the penalty is 5% of the unpaid taxes for each month the return is overdue, up to a maximum of 25% after five months. Beyond five months, penalties and interest continue to accrue, but at a lower monthly rate. This means that waiting to file your taxes can cost you more than just time—it can also impact your wallet.
What Happens If You Don’t File a Tax Return?
Failing to file a tax return when you owe taxes can have serious legal consequences. Not filing your taxes on purpose, especially when you owe the IRS money, is considered a crime. Under the law, willfully failing to file a tax return is classified as a misdemeanor, and you could face hefty fines of up to $25,000 per year. Additionally, you may be sentenced to up to one year in prison for each year you fail to file (I.R.C. § 7203).
However, if you file your tax return but can’t pay what you owe, you won’t face criminal charges. Instead, you’ll be required to pay penalties and interest on the outstanding amount. It’s important to understand that even if you don’t have the funds to pay your tax debt right away, it’s still crucial to file your return. Filing allows you to explore options for addressing your back tax debt, including installment plans or negotiating for a reduction in the amount owed. Don’t delay—filing is the first step in resolving your tax issues.
Could I End Up in Jail for Failing to File Taxes?
While the U.S. justice system simply doesn’t have enough jail space to imprison even a small percentage of people who don’t file their taxes, the likelihood of going to jail for failing to file is extremely low, even if you owe a large amount in taxes. That being said, in rare cases, jail time is a possibility. If your failure to file taxes is considered part of a deliberate attempt to evade paying taxes, you could be charged with a felony—a serious tax crime that carries a potential prison sentence of up to five years and a penalty of up to $100,000 (I.R.C. § 7201).
However, it’s important to note that most people who fail to file taxes are not criminally prosecuted for a felony. The felony charge typically involves an additional element of deceit, such as deliberately using a fake Social Security number to hide income, whereas simply not filing a return is considered a misdemeanor. In most cases, individuals are charged with a misdemeanor, which doesn’t require this level of intentional fraud.
Conclusion
Filing taxes is a task that can feel overwhelming for many, especially if your financial situation is complicated. The time it takes to complete a tax return varies depending on whether you’re filing as an individual or a business owner. While the average time for nonbusiness taxpayers is about 9 hours, business taxpayers typically spend 24 hours on tax preparation. Regardless of your situation, it’s important to stay organized and plan ahead to reduce stress and avoid costly errors.
By keeping accurate records throughout the year and using tax preparation tools, you can streamline the process and save time when it’s time to file. Hiring a professional, like Austin & Larson Tax Resolution, can help ensure everything is done correctly and efficiently. They can guide you through complex tax scenarios and help resolve any outstanding issues with the IRS.
Don’t wait until the last minute to file your taxes—procrastination can lead to mistakes, missed opportunities, and even penalties. Take the time to properly prepare and file your taxes on time, and you’ll avoid unnecessary complications. If you need assistance, don’t hesitate to reach out to Austin & Larson Tax Resolution for expert help in resolving your tax debt.
FAQs
How long does it take to file a basic tax return?
It typically takes around 9 hours for nonbusiness taxpayers to file a basic tax return, including recordkeeping, tax planning, and form completion.
Why do business owners spend more time on their taxes?
Business owners spend more time due to the complexity of their returns, which may involve multiple forms, detailed recordkeeping, and tax planning for their business operations.
Can I speed up the tax filing process?
Yes, staying organized with your records and using tax preparation tools can help speed up the process. You can also consider hiring a tax professional to ensure accuracy and efficiency.
What happens if I miss the tax filing deadline?
Missing the deadline can result in penalties and interest charges. It’s important to file on time to avoid additional costs.
What should I do if I can’t pay my taxes?
Even if you can’t pay your taxes in full, it’s crucial to file your return. Filing allows you to explore payment options like installment plans or negotiating a reduced payment with the IRS.
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