Filing Taxes For The First Time? How To Get Started

Posted: Jan 16 2017, 8:54am CST | by , in News | Also on the Geek Mind

 

Filing Taxes for the First Time? How to Get Started
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It is officially that time of the year, tax season. While many people won't file for a few months, it is important for some people to get started now. Many of us have amassed "official tax document" mailers that may or may not be opened. As excited as many people are for a nice return, it is difficult to understand what you need so successfully complete your taxes.

So what do you need to do your taxes? What happens if you do them wrong? Do you need to hire someone to do your taxes? 

The first step is that procrastinating is not the best way to deal with anything. You have to file your return by April 15, or at least file an extension form by then. If you are due a refund, the sooner you can get them in, the better.

To make everything seem less confusing, we have a few tips and tricks to help you out:

Step 1: Do I Have to File Taxes?

The first step is to see if you have to file at all. There are plenty of things that can change your filing status - schooling, age, living at home, whether your parents claim you as a dependent, and how much you earned. You are required to file a tax return if you earned more than $5,000 in many cases.

Step 2: Gather 2016 Tax Documents

Now, you have to consider all of your sources of income from 2016, including potential tax credits or deductions. You should have a W-2 form from your employer. Your W-2 is a record of how much money you earned throughout the year and how much was taken out for things like federal taxes and Social Security. If you've done freelance work, you may receive a 1099 through snail mail or online, depending on the company. Keep track of all your income - you are responsible for it.

You should also collect forms relating to student loans, including a 1098-T tuition statement.

This could all take weeks, depending on your employer, school, and other factors. Make sure to look at all of the documents you receive instead of just setting them to the side. If there is something wrong, you need to get it fixes ASAP.

Step 3: Fill Out Forms and File

Once everything is collected, you have to fill out the forms and file. Which form should you use? If you don't own real estate, you don't invest, you have no dependent children, you're under 65, and you make less than $100,000, you can file a 1040EZ, a simple form. Otherwise you will need to file a 1040A or the full 1040, which is available online at the IRS website.

For people who have never filed taxes before, doing so on paper might be easier - or at least working out the problems on paper and then electronically file.

"If you've ever seen those forms, they can get pretty scary pretty quickly," says Eric Roebuck, a senior product manager at H&R Block. Particularly helpful for tax novices hoping to claim deductions and credits, various tax software can guide you to savings with simple questions such as, "Did you get married this year?" or "Did you make payments on student-loan debt?" "You don't need to know tax laws; you just answer questions about your life," says Lisa Greene-Lewis, a CPA for TurboTax.

If you get confused, software that you can use to file does have a chat option. There are free digital filing options for people with simple returns.

Should I Get My Taxes Professionally Done?

If you have something that is more complex with your taxes, like self-employment or investment income, then you might need to get assistance. Still, it is an expensive thing to do - anywhere between $100 to over $400. 

If you do this, make sure to go to someone who you trust, like a professional company that has a good name. Talk to your friends, family, and colleagues to see who they go to.

This story may contain affiliate links.

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The Author

<a href="/latest_stories/all/all/46" rel="author">Noel Diem</a>
Noel passion is to write about geek culture.

 

 

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