So you procrastinated on your taxes for the umpteenth time in a row, but you still have until April 17. The following tips and tools can help you nav. your 1040 with a lot of grit and a bit of grace (and get you back to your busy schedule of rewatching Arrested Development).
- Easy to get
- No charger
- Left handed use only
- Supports only Apple products
- Low storage
I’ll admit that tax season gives me the nervous sweats. I get anxious and overwhelmed that I’ll miss something important especially when I close in on the deadline before even taking a look at my W-2. This year I decided to educate myself on all things taxes and break it down into easy manageable steps. Since I believe in sharing the wealth, I’ve compiled my learnings into a tax guide so you can get your taxes done like a boss and get back to your birthright of Netflixing.
If you are under 65 and earn $10,400 or more per year, you must file by April 17. We’re closing in on that date, so let’s get started.
Gather your documents
First things first, find your W-2 (this might be the hardest part) that you should have received from your employer back in January. You’ll need to report your individual income on form 1040, and if you have a side hustle, good for you for having the energy for that type of thing, but you’ll need form 1099 for this, as well. You may need several other forms to report your deductions, but I’ll get to this below.
Be a freeloader
Download the Free File Software at IRS.gov. If your income is below $66,000 you can use the free software instead of forking money over for some commercial software or tax preparer. And you get the added satisfaction of knowing you did it yourself. You’re a strong, independent lady who doesn’t need the help of anyone (it helps to talk yourself up before diving in).
Get some easy credit
We are not talking astronomy 101. We are talking tax credits that help increase the amount of your refund. Get credit for dependents, health care, education, and so forth.
Determine whether to itemize your deductions
Deductions reduce your taxable income, so more deductions are better. Choose the method that provides the highest possible deduction. Most tax software will help you make this decision.
Standard: This one is easy peesy. Just take the standard deduction based on your marital status and household size to reduce your taxes. Voila! Some people don’t qualify for the standard exemption and therefore should itemize. So be sure to double check.
Itemized: Popular itemized deductions include but are not limited to (take a look at this full list of deductions:
- Property tax because when you pay your local government, your federal government pays you back!
- Charitable donations, like all the clothes you donated to Goodwill that could never see the light of day at your fresh-out-of-college professional job.
- Student loan interest (the one time you might feel good about debt, right?)
- Mortgage interest. (Hopefully your refund helps you upgrade from a futon to a real bed, now that you have a place to call your own.)
Find your taxable income
Once you have entered your income, credits and deductions, it’s time to find your taxable income. Again, your tax software will do this for you. #showmethemoney
Get your refund fast
For a speedy refund, set up direct deposit and then e-file. Filing electronically ensures the fastest possible refund and if you set up direct deposit, the cash money is sent straight into your account.
Listen up, self-employed folks
If you have a small business or are an independent contractor (think Uber driver, AirBnb rent), you must file your net earnings if they $400 or more. Self-employed individuals report income annually like everyone else but must pay an estimated tax quarterly.
Don’t play yourself
Beware of the tricksters out there. Some of these scammers can sound legitimate but are only looking to take away your hard-earned dollars (and that’s only for the government to do). Review IRS’ Dirty Dozen Scams so you don’t find yourself in a sticky situation when you make that last-minute Hail-Mary attempt to make the deadline.
If you’re really not ready to do your taxes and you won’t make the April 17 deadline, you can file for a six-month extension. Be aware that penalties and interest may apply to money you owe after April 17.
Get ready for next year
Everyone is talking about the tax reform but most of the changes do not come into effect until the 2018 tax year. Does this mean you’re off the hook? Not quite. Although it won’t affect your taxes this year, there may have been some changes to your tax bracket. This could mean that your employer may not be withholding enough taxes on your paycheck during 2018. If that happens you may be left with a tax bill come 2019. If you’re worried, visit the withholding calculator at IRS.gov. Remember, knowledge is power.