March 2025
Tax season is here! Whether it’s your first time filing or you just need a refresher, don’t stress! Understanding taxes might seem complicated, but with the right information, you can navigate through the process with confidence. Here’s a quick guide to help you get started.*
1. Know If You Need to File
Not everyone is required to file a tax return, especially if you’re still in school or just starting out in your career. Generally, you need to file if you earned income above a certain threshold, which is $14,600 for single filers under age 65 this year, but this can vary depending on your filing status, age, and type of income.
2. Gather Your Documents
Before you can file your taxes, you’ll need to gather all the necessary documents. Here’s a list of the most common items:
- W-2 Form (if you were employed): This shows your total earnings and the taxes that were already withheld.
- 1099 Form (if you worked as an independent contractor or freelancer): This shows your earnings from gigs or self-employment.
- Receipts for Deductions: If you qualify for deductions (like student loan interest, education expenses, or charitable donations), keep those receipts handy.
- Social Security Number (SSN): You’ll need this to identify yourself as the taxpayer.
3. Understand Tax Credits and Deductions
As a young adult, you might qualify for a few tax credits and deductions that can reduce the amount you owe:
- Standard Deduction: Almost everyone is eligible for this. It reduces your taxable income.
- Education Credits: If you’re paying for school, you could be eligible for credits like the American Opportunity Credit or the Lifetime Learning Credit.
- Earned Income Tax Credit (EITC): If you earned a low to moderate income, you may qualify for this refundable credit, which could result in a bigger refund.
4. Choose How to File
There are a few ways to file your taxes:
- DIY Online: There are free and low-cost online tax filing services like TurboTax, H&R Block, or IRS Free File that make it simple to complete your return.
- Tax Professional: If your taxes are more complicated (for example, if you’re self-employed or have other sources of income), you might want to hire a professional to help.
- Paper Filing: If you’re old-school, you can still fill out a paper return, though it’s a little slower than the digital methods.
5. Avoid Common Mistakes
It’s easy to make mistakes when filing your taxes, but here are a few to watch out for:
- Incorrect Social Security Number: Make sure it’s typed correctly on all forms.
- Missing Forms: Double-check that you’ve included all forms (W-2, 1099, etc.).
- Math Errors: Double-check your calculations, especially if you’re doing it manually.
Using tax software or an accountant can help reduce the risk of errors!
6. File On Time
Avoid penalties and interest by filing your taxes on time. The deadline for most individual returns is April 15th, though it may vary if that falls on a weekend or holiday. If you can’t file on time, you can request an extension, but keep in mind that any tax you owe will still be due on the original deadline.
7. Check for Refunds
If you’ve had taxes withheld from your paycheck (via your W-2), you may be due for a tax refund. This means the government took more than necessary, and you’re getting the difference back. You can check the status of your refund using the IRS Where’s My Refund Tool.
Taxes can feel complicated, but once you understand the basics, it’s much easier to manage. Take your time to gather all the information you need, maximize any deductions or credits, and avoid common mistakes. And don’t be afraid to ask for help if you need it! There are a lot of resources on the IRS website or consult with a tax advisor to make sure you’re doing everything correctly.
*This is general information for illustrative purposes only. Be sure to consult with a tax professional for personalized advice tailored to your situation.