Tense About Tax Time?

Plan ahead so your taxes aren’t a headache.

Couple enjoying their afternoon in their living room with their dog

Everybody gets a little grumbly at tax time. Preparing your finances for the government to look over can feel intimidating, but it doesn't have to be. With some good planning and organization, you can get your taxes done like a boss.

To File or Not to File?

Step one: figure out if you need to file.

There isn’t always an obvious answer to who should file federal taxes. The Internal Revenue Service (IRS) has a handy resource page; check with your tax professional if you’re still unsure.

Prepare to File

  • If you do need to file taxes, here are some tips to keep you organized:
  • Most documents you need to complete your return are sent out at the end of January:
    • W-2s — wage statements from your employer(s) that break down your yearly earnings. You should receive a W-2 from each employer that paid you a wage during the previous calendar year — keep that in mind if you only worked over the summer, you switched jobs or you work multiple jobs.
    • Form 1099 — earnings statements from each financial institution that paid you interest during the year. Generally, these are brokerage firms where you have earnings or losses, or any corporations or mutual funds in which you own shares.
  • Keep these documents in a safe place until you’re ready to complete your tax return. You can file your taxes any time before the deadline (typically April 15).
  • The earlier you file, the sooner you receive your tax refund, if you’re owed one. Depending on your situation, you may owe money to the government.

Filing Tips

When you’re ready to file, it’s important to know a few things.

What is gross income:

  • All taxable income from a particular year (salary, wages and tips, sick pay, unemployment wages and strike benefits)
  • Investment income, interest and dividends
  • Farm income, rent payments from tenants, gambling earnings, retirement and Social Security payments

Some financial information can be excluded from your tax return, including workers compensation benefits, veterans’ disability benefits, welfare income, Supplemental Security Income, child support payments, life insurance payouts and scholarships for college tuition.

Don’t sleep on freebies: If you’re a student, you might qualify for free tax prep software like TurboTax, which guides you through the filing process. The IRS has a page to help individuals identify if and what free software they qualify for.

When to ask for help: Filing your federal return is usually straightforward, but it’s also totally reasonable to have questions or get stuck at some point. Resources available online — including from the IRS itself at IRS.gov — can help answer questions and provide additional sources for more hands-on assistance.

Still not sure how to file or what you’ll need? Take some time to work through this coach for guidance.

And don’t forget about state taxes, which are in addition to federal taxes. More information specific to each state can be found here.

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