Types Of Taxable Income
You have to report any taxable income you earn inside and outside Canada when you file your tax return. This includes:
- any full-time or part-time work
- self-generated income
- rental income, including renting out a portion of your home
- your pension
You do not have to report certain non-taxable amounts as income, including:
- elementary, secondary and post-secondary school scholarships
Know The Pros And Cons Of Digital And Paper Tax Returns
David J. Rubin is a fact checker for The Balance with more than 30 years in editing and publishing. The majority of his experience lies within the legal and financial spaces. At legal publisher Matthew Bender & Co./LexisNexis, he was a manager of R& D, programmer analyst, and senior copy editor.
When you file your taxes, you have two options for submitting your return with the Internal Revenue Service : electronically or by mail.
Both methods of filing have their pros and cons. E-filing is safe, faster, and generally more convenient than paper filing. Filing by mail can be cheaper, though it takes the IRS longer to process refunds.
Learn more about choosing how to file your tax return.
Why Do I Have To Do My Taxes
Because its mandatory. In Canada, taxes pay for services we all benefit from, everything from schools and roads to social programs like employment insurance and family allowance payments.
If your annual income is below a certain level, you may not have to pay taxes. But its still a smart idea to file a return, because you could receive money or qualify for tax benefits from different levels of government.
If you have a job, chances are your employer deducts a certain amount from your cheque for tax purposes. If too much is deducted during the year, the only way for you to get it back is by filing a return. Learn to make a budget to manage a potential tax refund.
Good to know: In addition to paying income tax to the federal government, you also need to calculate and pay tax to the government of your province or territory. The Canada Revenue Agency receives your return and payments and administers the tax system at both the federal and provincial levels, except for the province of Quebec.
If you live in Quebec, you have to file two tax returns, because Revenu Québec handles the provincial portion.
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Gather All Your Documents And Keep Them In A Safe Place
Youll receive some documents by mail, and others electronically. Whether you do your taxes, or someone does them for you, keep your supporting documents. Government revenue agencies have up to six years to request them after your return is filed.
Other documents that are useful for doing your taxes:
- Invoices for education-related expenses
What Do I Need To File Taxes By Mail
Include all necessary tax forms for the IRS if you file by mail: your Form 1040 or 1040-SR, any schedules, and any other additional forms you have to fill out for your particular return. You should also include a check if you owe any taxes, or you can use IRS Direct Pay to make payment online from your checking or savings account.
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Where To File Your Return
Taxpayers using eFile will have their returns processed electronically once they are submitted.
For taxpayers filing using paper forms:
- If you expect a refund, be sure to mail your return to the North Carolina Department of Revenue, PO Box R, Raleigh, NC 27634-0001.
- If you owe taxes, mail your return and payment to the North Carolina Department of Revenue , PO Box 25000, Raleigh, NC 27640-0640. Make your check or money order payable to the NC Department of Revenue. Important: The Department will not accept a check, money order, or cashier’s check unless it is drawn on a U.S. bank and the funds are payable in U.S. dollars.
When Should I Expect My Employer To Issue Me My T4
Your Employer legally must hand you your T4 in person, or by email before the deadline of the last day in February. It is very important to receive this information on time. If your Employer has not given you your T4 by this date you have the right to demand the document and or take it up with the Labour Board. Most business do offer the T4 between January to end mid February. So if it is January do not be frazzled if it is still not here.
If you have finished working for your employer part way through the year. They still have the legal obligation to give your T4 to you by end of February the following year. For example, you finished your job October of 2021. They do not have to give you a T4 until end of February 2022. This will be in time for you to file your tax return by April 30 2022.
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The Taxation And Revenue Department Encourages You To File Electronically Whenever You Can
Electronic filing is safe and secure, and it offers the fastest service for a refund. Access online filing to file over the internet at no charge . You may choose to file electronically through your tax preparer or by using approved software on a personal computer. Individuals who both file and pay their income tax electronically using our website, a personal computer or a tax professional have an extended filing deadline of April 30. If April 30th is on a Saturday, Sunday or legal state or national holiday, the due date is the next business day.
The Department offers two ways to file a return electronically, both allowing you to file either a refund return or a tax-due return. File electronic returns through the Departments internet website or the Federal/State Filing Program. Certain restrictions on who may file and the types of returns eligible for electronic filing depend upon the electronic filing program used by the Taxation and Revenue Department and Internal Revenue Service websites contain information about the electronic filing options.
You may pay taxes over the internet with Visa, MasterCard, Discover or American Express cards. A convenience fee covers the costs that the companies bill the state when a credit card is used. There is no charge if you pay by electronic check. An electronic check authorizes the Department to debit a checking account in the amount and on the date specified.
Where To Send Returns Payments And Extensions
The Balance / Lara Antal
It’s usually best to go the extra mile when you’re dealing with the Internal Revenue Service , even if it feels like a nuisance or a waste of time. That’s even more applicable if you’re one of the few people who still file a paper or “snail mail” tax return rather than filing electronically.
Following a few guidelines will ensure that your tax return goes to the proper address, that it gets there on time, and that you have proof of delivery.
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How To Mail A Paper Return
You may need to mail a paper return to the IRS or state agency if:
- You prefer mail over e-file
- Your e-file was rejected and must be paper filed to correct the problem*
- You’re filing your return after the October deadline
Before mailing the return, be sure to read the filing instructions. They will include important information such as where to file, what to attach to the return , refund or balance due, information about estimated tax payments, etc.
Note. File your return, schedules, and other attachments on standard size paper. Cutting the paper may cause problems in processing your return.
*Note. If you are paper filing your return because you were rejected on the filing due date, you should also include an explanation and a copy of the IRS rejection with your paper return. This return would need to be mailed within 10 days of your rejection and no later than April 25th.
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Gather Tax Filing Information
Youll need to do this whether youre hiring a tax preparer or doing the tax filing yourself. The goal is to gather proof of income, expenses that might be tax-deductible or win you a tax credit, and evidence of taxes you already paid throughout the year. Our tax prep checklist has more guidance, but heres a short version of what to round up:
Social Security numbers for yourself, as well as for your spouse and dependents, if any.
W-2 form, which tells how much you earned in the past year and how much you already paid in taxes.
1099 forms, which are a record that some entity or person not your employer gave or paid you money.
Retirement account contributions.
State and local taxes you paid.
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Learn Which Credits And Deductions You Can Take
Getting a sense of which can help you pull together the proper documentation. Here are a few to consider:
- Savers credit. If you are not a full-time student and are not being claimed as a dependent, you may be eligible for a tax credit if you contribute to a retirement plan. The amount of the credit depends on your filing status and adjusted gross income. For the 2022 tax year, if your filing status is single, you may be eligible if your adjusted gross income is $34,000 or less. If you are married and are filing jointly, you may be eligible if your adjusted gross income is $68,000 or less. However, these numbers are subject to change in future tax years.
- Student loan interest. You can deduct up to $2,500 in interest payments, depending on your modified adjusted gross income.
- Charitable deductions. Donating to your alma mater or a favorite charity? Generally, you can deduct qualified charitable donations if you itemize your taxes.
- Freelance expenses. If you are self-employed, you may be able to claim deductions for work-related expenses such as industry subscriptions and office supplies.
If you think you may qualify for additional credits or deductions, check the IRS website.
Get A Transcript Of A Tax Return
A transcript is a computer printout of your return information. Sometimes a transcript is an acceptable substitute for an exact copy of your tax return. You may need a transcript when preparing your taxes. They are often used to verify income and tax filing status when applying for loans and government benefits.
Contact the IRS to get a free transcript . There are two ways you can get your transcript:
Online – To read, print, or download your transcript online, you’ll need to register at IRS.gov. To sign-up, create an account with a username and a password.
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Can You File Your Tax Return Without Your T4 Slip
The answer to this very common problem is a big YES! You can still file your return without the T4 slip for sure. However you do need the data that is on the T4 slip itself. There are many ways on how to gather the information from your missing T4 slip. Firstly, you can always use a service called Auto-Fill. Many tax software providers and Certified Accountants are able to Auto-Fill your tax return when filing. This process is simply downloading your T4 from your CRA account and automatically filling it on your tax form. Accufile is able to do this for 100,000’s of customers each year and the process is easier than you think.
Another great way to obtaining your T4 information without your T4 slip is by calling The Canada Revenue Agency. They will be able to tell you the numbers on your T4 slip over the phone. However, make sure to write down every number and box number they give you. Each number will come with a box number for example: Box 14 $14,000. There are many box numbers on a T4 so be sure to make sure the CRA gives you all of the numbers. The reason why the CRA would have this information is due to the fact your employer must provide them with a copy of your T4 before the end of February of the next calendar year.
Save The Right Paperwork All Year Long
Stay on top of tax-related paperwork throughout the year it will make your life easier during tax season. You might want to keep receipts for things like charitable donations, work-related expenses and medical bills, or other items from step 4. You may also want to keep statements from student loans or investments and any grants or fellowships. Having these handy and organized can help you determine whether to itemize and make the process easier. You should keep your paperwork after you file, too. The IRS recommends keeping records for at least three years.
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Taxpayers Who Live Or Work Outside The Us
If you are a U.S. citizen or resident alien who lives or works outside the United States, you will have to mail your return.
If you expect a refund or arent including a payment with the return, you can mail it to:
Department of the TreasuryInternal Revenue Service CenterAustin, TX 73301-0215
If youre sending a payment, mail the return and your check or money order to:
Internal Revenue ServiceCharlotte, NC 28201-1303
Send A Paper Return By Mail
If you are mailing someone elses paper return
If you prepare other peoples returns, mail each persons return in a separate envelope. However, if you file returns for more than one year for the same person, put them all in one envelope.
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Protect Yourself From Tax
Tax ID theft occurs when someone steals your personal information to file a tax return using your personal data. Usually, the fraudulent tax filer will use your Social Security number to file your return in order to collect a refund. To protect yourself from tax ID theft, you can obtain a six-digit Identity Protection PIN from the IRS. IP PINs are known only to you and the IRS so the IRS is able to confirm your identity when you file your return. Learn more about how the IP PIN works and how to apply.
Do You Even Have To File Taxes
Even if you dont have to file taxes, you might want to do it anyway: You might qualify for a tax break that could generate a refund. So give tax filing some serious consideration if:
You qualify for certain tax credits.
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Using A Software Package To Netfile Your Return
If you are doing your own tax return, we strongly recommend using tax software rather than pre-printed forms to prepare your return, because this can help to avoid errors and missed tax credits. Many credits, such as the Canada Employment amount, are calculated automatically. However, if your return is complicated, it may be best to have your return professionally prepared, or at least reviewed.
You can use NetFile to submit your tax return from your home computer. You may either purchase tax calculation software at a retail store, download software over the internet, or file your tax using an online tax return. It is not always necessary to spend money to file your tax return using income tax software. Some of the software packages are free for everyone, and some are free if you have low net income and a simple return. Canada Revenue Agency provides a list of tax software packages approved for NetFile, and the list indicates whether the package includes a free option.
Note that T3 slips will likely not be received until April,so if you have mutual funds or exchange-traded funds in a non-registeredaccount, you won’t be able to file your return until April.
When you use NetFile to file your return, you do not mail a printed return or information slips, and if you are expecting a refund it usually arrives within 2 weeks. Not all tax returns qualify for NetFile – see the CRA web page on . Amendments to your tax return can be filed using .
Request A Copy Of Previously Filed Tax Returns
To request a copy of a Maryland tax return you filed previously, send us a completed Form 129 by mail or by fax. Please include your name, address, Social Security number, the tax year you are requesting and your signature. If you are requesting a copy of a joint return, include the information for both taxpayers and their signatures.
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