Facebook-square Facebook-square How To Do Taxes For The First Time: 5 Tips For Teens And Young Adults Mortgages, retirement funds, tax returns — these are strictly adult concerns, right? Hold on to your smart phones because the reality may shock you. If you’re making money, you may have to pay income tax. For example, if you’re a teen, you’re still considered a minor in almost every respect, but the government will treat you like full-fledged adult when it comes to federal income taxes. Take a minute to check out these tips and find out what you need to do to tackle this major adulting milestone like a champ. 5 Tax tips for first-time tax filers If you’re a first-time filer, it may seem intimidating to take on this responsibility. Don’t worry. We’re here to help and break it all down for you. Let’s go step by step for your first-time filing taxes. 1 – Know if you’ll need to file If you can be claimed as a dependent on another taxpayer’s return and you’ve had a job — even a part-time one — and earned more than $13,850 in the tax year—you’ll need to file. Alternatively, if you didn’t have a job but made more than $1,250 on unearned income (e.g., interest from investments), you will also be required to file. If you don’t fall into either category and area dependent, you are likely not required to file a federal tax return. However, if you did work and had taxes withheld, filing a return is the only way to get a tax refund. Plus, it’ll serve as a lesson for filing taxes in the future. We recommend doing it. 2 – Start the process ASAP The sooner you get started on your tax return, the sooner you can receive your refund check. If nothing else, at least begin the process now so you can figure out how much time you’ll need to devote to filing taxes. This means gathering all the necessary documents, perhaps talking to a tax professional, using an online tax filing program, or even just researching answers to any questions you might have. This will relieve some of the pressure when it comes to actually filing! 3 – Gather the necessary documents Aside from personal information, which you should already know or have easy access to, you’ll need a W-2 form from each of your employers or a 1099 Form if you were a contractor. These summarize the amounts paid to you over the past year and the taxes being withheld from you. The W-2 form is for employees and must be issued by your employer no later than January 31. The 1099-NEC form is for independent contractors and will also be sent to you by the January 31 deadline. You should also gather any additional forms that showed you spent money on a big expense (ex. education), as that should be noted in your return. Take a look at your tax preparation checklist for more details about the tax forms and other documents you need to file taxes. 4 – Be organized This is a handy tip no matter what you’re doing, but it’s essential when dealing with government agencies, such as the Internal Revenue Service, that may not be quick to address your concerns. Translation: Store any and every document that is related to your job, your money, and your taxes in one secure place. It’ll save you time and headaches so you don’t accidentally misplace your W-2 and need to request a new one. 5 – Take control of your money There is a way to know if you’ll owe money or get a tax refund. In the simplest terms possible, if you paid more taxes than the government requires, then you’ll get a refund check in the mail or via direct deposit. On the other hand, if you come up short on what you’re required to pay, then you’ll owe taxes. To determine how much you’re paying in taxes on each paycheck, look at your paystub. That thing called “withholding” is directly related to your money and the amount taken out of your paycheck. The more you withhold, the more money taken out of your paycheck. It’ll result in less money on your paychecks, but a better chance of receiving a refund. Withhold less and your paychecks will be heftier — but your chances of owing money come tax season will also rise. You can use our W-4 paycheck tax calculator to estimate your refund or tax due based on your current W-4 form; this can give you a better idea of whether you are claiming the right number of exemptions for your tax situation. If you’re an independent contractor, you’ll be the one responsible for taking care of self-employment taxes and income taxes — no one will withhold those taxes or send them to the IRS for you. Leave a Reply Cancel Reply Logged in as taxesdoneright. Edit your profile. Log out? Required fields are marked * Message* Quick Links Contact Us (706) 221-0538 2111 Wynnton Rd, Columbus, GA 31906 Hours Monday: 10AM to 7PM Tuesday: 10AM to 7PM Wednesday: 10AM to 7PM Thursday: 10AM to 7PM Friday: 10 AM to 4 PM Saturday: 10AM to 5PM Sunday: CLOSED
