Current:Home > StocksHow to file your tax returns: 6 things you should know this year-LoTradeCoin
How to file your tax returns: 6 things you should know this year
View Date:2025-01-13 17:26:18
For something that's legally required, taxes can be tough to figure out. The U.S. system is complicated — and unfortunately, most of us never learned how to do our taxes in school.
The deadline to file your taxes this year is April 18. But it helps to get started as soon as possible.
In this guide from Life Kit, we share 6 expert tips you should know about filing your taxes — from what steps to take as the deadline approaches, to whether hiring a tax preparer is worth it.
1. You don't have to pay to file your taxes.
One free option: Download your tax forms from the IRS website, read the instructions, fill everything out, and submit by mail or online. That's easier if someone like a parent has walked you through it before, or if you have a simple tax situation like one job, in one state, for the entire year.
If your tax situation is more complex, there's free online software you can use. If your adjusted gross income is $73,000 or less, you qualify for a program called IRS Free File. Find out more at the IRS website.
If you don't qualify, you can still get deals on online tax software, says Akeiva Ellis, a certified financial planner and co-founder at The Bemused. She uses a service called Free Tax USA; it charges $15 per state, and the federal return is free.
2. Consider tagging in a professional.
Another option is to go to an accountant or tax preparer. That might make sense if you're doing your taxes for the first time, or if you've had a major life change — like getting married or starting a new business. It may also make sense if you want to do some tax planning for the year ahead, says Andrea Parness, a CPA and certified tax coach.
If you're looking for a pro, start by asking friends and family for referrals, she says. And then interview the person. Prepare questions for them: Will they be giving you tax advice, or just filling out the forms and submitting them? Will you have an appointment? And what happens if they make a mistake?
"It's like kicking the tires," Parness says.
3. Gather your documents.
The IRS has a list of documents you might need. Tax preparers can give you one, too. Some common examples: W2 forms, which report your income and your employers send you by mail, student loan interest forms, bank interest forms, and any receipts for things you're planning to take as a tax credit or deduction, like medical expenses or charitable donations.
4. Look into tax credits and deductions.
Both are benefits that save you money on taxes. A tax credit lowers your final tax bill; it comes off the top of what you owe. A tax deduction, on the other hand, "reduces the amount of income you have to pay tax on," Ellis says.
To figure out which credits and deductions you're eligible for, you can look at the IRS website. If you use software, it'll prompt you with questions to help figure this out. So will tax preparers.
But do your research. "You certainly always want to be able to educate yourself and not just depend on someone else asking you, 'Hey, did you buy a new car? Did you do this? Did you put your kid in daycare?' ... Everybody runs their practice differently and not everybody asks those questions," Parness says.
5. You can file an extension — but you still have to pay.
If you think you won't make the April 18 deadline this year, you can file an extension with the IRS online. Then you'll have until mid-October to file the forms. But if you owe money, you still need to estimate how much and pay it now, or you might get hit with penalties later.
6. Plan ahead for next year.
Think about what went wrong on your tax return this year. For instance, did you end up owing a ton of money? Did you get a huge refund? That often means you gave the federal government an interest-free loan. You can make changes now so that doesn't happen next year. For instance, "ask your employer for a form W-4 so that you can properly tell them how much taxes to take out of your check," Ellis says.
Also, look out for tax credits, deductions, or rebates that you're newly eligible for. A little planning and research now could lower your next tax bill.
The audio portion of this episode was produced by Mia Venkat, with engineering support from Carleigh Strange, Patrick Murray, and Neil Tevault. It was edited by Meghan Keane. The digital story was edited by Danielle Nett. Our visuals editor is Beck Harlan. We'd love to hear from you. Leave us a voicemail at 202-216-9823, or email us at LifeKit@npr.org.
Listen to Life Kit on Apple Podcasts and Spotify, or sign up for our newsletter.
veryGood! (5244)
Related
- J.Crew Outlet Quietly Drops Their Black Friday Deals - Save Up to 70% off Everything, Styles Start at $12
- Biden to announce new student loan forgiveness proposals
- Defending champ UConn returns to NCAA title game, beating Alabama 86-72
- World War II bunkers built by German army unearthed during nature restoration project in Belgium
- Dramatic video shows Phoenix police rescue, pull man from car submerged in pool: Watch
- Chioke, beloved giraffe, remembered in Sioux Falls. Zoo animals mourned across US when they die
- More proof Tiger Woods is playing in 2024 Masters: He was practicing at Augusta
- Little Big Town Reveals Taylor Swift’s Surprising Backstage Activity
- NFL coaches diversity report 2024: Gains at head coach, setbacks at offensive coordinator
- What Is Keith Urban’s Top Marriage Advice After 17 Years With Nicole Kidman? He Says…
Ranking
- These Michael Kors’ Designer Handbags Are All Under $150 With an Extra 22% off for Singles’ Day
- MLB power rankings: Red Sox come home with best pitching staff in baseball
- How Amber Riley Feels About Glee Family 15 Years Later
- Stock market today: Asian shares mostly rise as investors look to earnings and inflation signs
- Tech consultant testifies that ‘bad joke’ led to deadly clash with Cash App founder Bob Lee
- Trump declines to endorse a national abortion ban and says it should be left to the states
- Looking back (but not directly at) Donald Trump's 2017 solar eclipse moment
- Morgan Wallen has been arrested after police say he threw a chair off of the roof of a 6-story bar
Recommendation
-
'The Penguin' spoilers! Colin Farrell spills on that 'dark' finale episode
-
Trump declines to endorse a national abortion ban and says it should be left to the states
-
Tori Spelling Reveals If a Pig Really Led to Dean McDermott Divorce
-
Ohio state lawmaker’s hostile behavior justified legislative punishments, report concludes
-
Kate Spade Outlet’s Early Black Friday Sale – Get a $259 Bag for $59 & More Epic Deals Starting at $25
-
What happens during a solar eclipse? Experts explain the awe-inspiring phenomena to expect on April 8
-
South Carolina-Iowa highlights: Gamecocks top Caitlin Clark for national title
-
CIA Director William Burns to return to Middle East for new Israel hostage talks