Make Filing Taxes Easy With These Beginner-Friendly Steps

Erick

Hi everyone! Taxes can seem overwhelming, especially if this is your first time filing. But don’t worry. Understanding the basics is easier than you think. Whether you’re starting your first job, making money from a side hustle, or just trying to understand how taxes work, this video is for you. By the end, you’ll know what counts as taxable income, how to get your tax refund quickly and the most common mistakes to avoid when filing your taxes.

It doesn’t have to be complicated. Let’s dive in and make taxes easier to understand. One of the first things you need to know when filing taxes is what the IRS considers taxable income. The most common types of taxable income include W-2 income, self-employment earnings, and income from investments. If you’re working a traditional job, your employer will automatically withhold taxes and report your income on a W-2 form, which you’ll receive in January.

This form will include details about how much you earned and how much taxes were withheld each year. If you’re working as a freelancer, driving for a rideshare service, or making money from selling things online, you’re considered self-employed. In this case, you’ll receive a 1099-NEC form, which will report your earnings. Taxes aren’t automatically taken out of this income, so it’s important to plan ahead for any taxes you owe.

Another source of taxable income is the interest you earn from the savings accounts or investments. If you earn any interest or dividends from your bank or brokerage account, you’ll likely receive a 1099-INT or 1099-DIV form. Even small amounts of interest can be taxable, so be sure to include them on your tax return. It’s important to remember that the IRS receives copies of these forms, so it’s crucial to report your income accurately.

If you’re expecting a tax refund, there are steps you can take to make sure it gets to you as quick as possible. First, file your taxes early. The earlier you submit your return, the sooner the IRS will process it and send you any refund that’s due. Filing early can also give you extra time to deal with any unexpected issues that might come up. Like missing information or additional forms you need to include.

Next, opt for electronic filing. File your taxes electronically or e-filing is much faster and more efficient than mailing in paper returns. Most people get their refunds much quicker when they e-file, and it’s easier to track the status of your return online. Lastly, choose direct deposit for your refund. If you select direct deposit instead of receiving a paper check in the mail, the IRS can send your refund directly back to your bank account.

This typically shortens the wait time to as little as 2 to 3 weeks. Instead of waiting several weeks for a check. There are several common mistakes that first-timers often make, and they can result in delays, penalties, or missed opportunities for refunds. One of the biggest mistakes is not reporting all your income. If you earn money from freelancing or side jobs, the IRS already has records of that income.

Forms like the 1099-NEC. Even if you didn’t receive a W-2, it’s crucial to report all income on your tax return. Another common mistake is missing out on deductions or credits. You might qualify for various tax breaks that could lower the amount of taxes you owe. For example, if you’re a student or have student loans, there are tax credits and deductions that specifically are designed to help you reduce your tax bill. Be sure to research tax credits and deductions, or consult a tax professional to ensure you don’t miss any tax savings opportunities.

A third mistake is filing your taxes late. The tax deadline is usually April 15th each year. If you owe taxes and failed to file by the state, you could face penalties and interest on the amount you owe. However, if you’re not ready to file by the deadline, you can request an extension. Keep in mind an extension only gives you more time to file, not more time to pay any taxes you owe.

If you owe, it’s best to pay as much as you can by the original deadline to avoid extra penalties. At the end of the day, taxes don’t have to be stressful. By understanding what counts as taxable income, knowing how to get your refund quickly, and avoiding common mistakes, you can file your taxes with confidence this year. Remember to file on time, report all your income, and take advantage of any available deductions or credits to reduce your tax bill.

If this video was helpful, please give it a like and subscribe to our channel for more tips. If you have any tax related questions or want to share your own experiences, leave a comment below. I’d love to hear from you. Thanks for watching and good luck with your taxes this year.