Current:Home > StocksFirst time filing your taxes? Here are 5 tips for tax season newbies-LoTradeCoin
First time filing your taxes? Here are 5 tips for tax season newbies
View Date:2024-12-23 23:10:14
You’ve never filed a tax return. You just found out that you need to file one in 2024. You're wondering where to start.
Here are five tips for first-time filers, starting with perhaps the most important one: deciding if the IRS needs to hear from you.
Figure out if you have to file a return
Generally speaking, anyone who earned at least $13,850 in gross income in 2023 must file a tax return in 2024. (We’re linking to a NerdWallet synopsis because IRS draft Publication 501 is a little hard to read.) Different rules apply for married people, older Americans and heads of household, but if you’ve never filed taxes, you may well not fall into those categories.
The $13,850 threshold applies even if a parent can claim you as a dependent on their tax return. If you are a dependent, you also must file a return if you have amassed at least $1,250 in “unearned” income, such as interest from investments.
Gather your tax documents
If you determine that you need to file a return, start pulling together the documents you’ll need to complete it:
W-2: If you have a job, this is the form the employer must send you by the end of January. It says how much money you earned last year, and how much tax was withheld.
1099s: These forms report income that didn’t come directly from a traditional employer. They show earnings from freelance or “gig” pay; interest and dividend income; and income from third-party platforms such as Venmo and PayPal.
Receipts: If you’re a first-time taxpayer, you will need to start keeping records of transactions that you might have to report on a tax form, including income, expenses and potential deductions. Examples might include donations to charity or a whopping medical bill.
Figure out if someone can claim you as a dependent
If you’re living with your parents or getting their help with tuition or living expenses, they may be claiming you as a dependent, or perhaps they should be.
Parents can claim you as a dependent if you’re under 19, or under 24 and studying full-time, and your parents kick in more than half of your financial support, TurboTax reports.
Your parents may reap tax benefits by claiming you as a dependent. And you’ll need to report your dependent status on your own return.
Tax season can be terrifying.Here's everything to know before filing your taxes in 2024.
Find out if you qualify for deductions or credits
Tax deductions reduce the amount of your income that is taxable, while tax credits reduce the amount of tax you owe.
Here are a few common tax deductions and credits for first-time taxpayers, according to Experian:
The Student Loan Interest Deduction: You can potentially deduct interest you paid on student loans, up to a maximum of $2,500.
The American Opportunity Tax Credit: If no one can claim you as a dependent, you may be able to reap up to $2,500 in credit for college expenses.
The Earned Income Tax Credit: You may qualify for this credit if you didn’t earn very much in 2023. Consult the IRS tables for details.
Decide if you need help
As a first-time taxpayer, you’ll need to choose whether to do your own taxes or hire a professional.
Most Gen Zers do their own taxes. And experts say that’s probably OK if you have a relatively simple return.
If you go the DIY route, you may be able to save money and complete the return quickly using tax software or the IRS Free File program.
More of your 2024 tax season questions answered
New Federal tax brackets for 2023-2024. What does it mean for you?
Flush with new funding, the IRS zeroes in on the taxes of uber-wealthy Americans
Your single largest payday may be a 2023 tax filing away. File early to get a refund sooner
Is it better to pay someone to do your taxes or do them yourself? We'll help you decide.
IRS delays 1099-K rules for ticket sales, announces new $5,000 threshold for 2024
IRS to offer pandemic-related relief on some penalties to nearly 5 million taxpayers
Driving for work will pay more next year after IRS boosts 2024 mileage rate
What is OASDI tax on my paycheck? Here's why you and your employer pay this federal tax.
A 30% national sales tax? Abolishing the IRS? Here's what the FairTax Act of 2023 would do
These 8 states don’t have an income tax. Does yours make the list?
What is net pay? How it works, how to calculate it and its difference from gross pay
Daniel de Visé covers personal finance for USA Today
veryGood! (729)
Related
- 1 dead, 2 children injured in wrong-way crash; driver suspected of DWI: Reports
- American Sepp Kuss earns 'life changing' Vuelta a España win
- Marilyn Manson pleads no contest to blowing nose on videographer, gets fine, community service
- Blue Zones: Unlocking the secrets to living longer, healthier lives | 5 Things podcast
- Taylor Swift Becomes Auntie Tay In Sweet Photo With Fellow Chiefs WAG Chariah Gordon's Daughter
- For Shakhtar Donetsk in the Champions League, representing Ukraine is a duty to the country
- Bodies of 5 Greek military personnel killed in Libya flooding rescue effort are flown home
- The Challenge Stars Nany González and Kaycee Clark Are Engaged
- Brianna LaPaglia Addresses Zach Bryan's Deafening Silence After Emotional Abuse Allegations
- Praise be! 'The Nun 2' holds box office top spot in second week with $14.7M
Ranking
- Moana 2 Star Dwayne Johnson Shares the Empowering Message Film Sends to Young Girls
- Deion Sanders on who’s the best coach in the Power Five. His answer won’t surprise you.
- Maine man who disappeared after driving wife to work found trapped in truck in New Hampshire woods
- Trump reiterates request for Judge Tanya Chutkan to recuse herself from his D.C. Jan. 6 case
- OneTaste Founder Nicole Daedone Speaks Out on Sex Cult Allegations Against Orgasmic Meditation Company
- Colts rookie QB Anthony Richardson knocked out of game vs. Texans with concussion
- Former NFL player Sergio Brown missing; mother’s body was found near suburban Chicago creek
- Billy Miller, 'Young and the Restless,' 'General Hospital' soap star, dies at 43
Recommendation
-
Roy Haynes, Grammy-winning jazz drummer, dies at 99: Reports
-
A new breed of leaders are atop the largest US unions today. Here are some faces to know
-
Idaho student murders suspect Bryan Kohberger followed victims on Instagram, says family
-
UN experts say Ethiopia’s conflict and Tigray fighting left over 10,000 survivors of sexual violence
-
'Serial swatter': 18-year-old pleads guilty to making nearly 400 bomb threats, mass shooting calls
-
2 pilots killed in crash at Reno air race
-
'American Fiction' takes Toronto Film Festival's top prize, boosting Oscar chances
-
Former Colorado officer avoids jail for putting handcuffed woman in police vehicle that was hit by train