How to file my own taxes?
I used to always wonder how to file my own taxes. Filing Tax returns can be a bit overwhelming for most people, especially if you plan to prepare and submit it on your own. Electronic filing option has made filing taxes much easier and less stressful, but it can still be difficult to know where to start. Some people have a complicated tax situation, and they are better off preparing their taxes by hand and sending them by mail. If I learned how to file my own taxes, so can you. read on to learn how to do your own taxes.
Seven Tax Preparation Tips
- Determine if you need to file a tax return: By law, you are required to file federal income tax returns if you are a citizen or resident of the United States or a resident of Puerto Rico. Your marital status, age, filing method and your income affect whether or not you are required to file taxes. I learned how to file my own taxes even if I was not required to file a tax. It’s a good idea to file so that you can recover any withholdings you paid on income tax.
- Determine if your dependent status excuses you from the need to file taxes. A dependent is still required to file taxes if they earn more than a certain amount in the fiscal year. If you are a dependent and do not earn more than $ 6,200 in the tax year, then you are not required to file taxes. If you earn more than $ 6,200 in a fiscal year, you would have to file taxes. In addition, if you receive more than $ 1,000 in unearned income during the tax year, you are required to file taxes.
- Determine you’refiling status: One of the first things you should do before you prepare your tax return is to determine your filing status. When I learned how to file my own taxes first thing I’ve done was to choose my material status. If you are not sure what your filing status should be, there is a quick questionnaire available at the IRS which can help you choose the right one.
There is five possible filing status to choose from:
Married filing jointly.
Married filing separately.
Unmarried head of household.
Qualifying widow or widower with a dependent child
- Gather all your documents and get organized: How to file my own taxes is also about being organized. It will help make your taxes and the process smoother. Before you start, gather the information needed to file your taxes, including your W2s, interest statements, school taxes, property taxes, receipts and other relevant information. You should also have a copy of your previous year’s tax return if you filed one.
* Form W-2: You will need the information on this form to file your tax return. If you are an employee, you should receive Form W-2 from your employer by 15 February. Your employer is required to provide or send W-2 to you no later than 31 January of the fiscal year. If you do not receive the form by February 15, please contact the IRS.
* Form 1099: If you are getting certain types of income, you can get a form 1099. For example, if you receive taxable income of $10 or more, the payer must provide or send you Form 1099 no later than 31 January of the tax year. If you do not receive the form by February 15, 1099, contact the IRS.
Choose the right tax preparation form
- Determine whether to use Form 1040EZ to file your taxes: You must use one of three forms to file your Return: Form 1040EZ, Form 1040A or Form 1040. Form 1040EZ is the easiest to file, but you must be careful when using this form, if your income is close to the maximum level of $100,000, you cannot claim itemized deductions on the 1040EZ, so the closer your income is to the maximum, the more you run the risk of excessive pay taxes because you cannot claim deductions. Use Form 1040EZ if you meet all the following conditions:
* Your filing status is single or married filing jointly.
* You (and your spouse if applicable) were under 65 and were not blind at the end of the current fiscal year.
* You do not claim any dependent.
* Your taxable income is less than $ 100,000.
* Your income is only from wages, salaries, tips, unemployment benefits, taxable scholarships and fellowships grants, taxable interest of $ 1,500 or less.
* You do not claim any adjustments income, such as a deduction for IRA contributions or student loan interest.
* You do not claim any credit other than the earned income credit.
* You do not owe any household employment taxes on wages paid to a household employee.
* If you earned tips, they are included in the boxes 5&7 of W-2 form.
* You are not a debtor in Chapter 11 Bankruptcy Case.
1040A or 1040
- Determine if you should use Form 1040A: If you are not eligible to use Form 1040EZ, you can use Form 1040A. 1040A allows you to declare most retirement income, including pensions and annuity payments, taxable social security and railroad retirement benefits, and payments from your IRA. Just keep in mind that you still cannot claim itemized deductions on Form 1040A. If you have deductions that can be itemized, you better file Form 1040. Use Form 1040A if you meet all the following conditions:
* Your income is less than $ 100,000
* You claim income adjustments for the following items:
- IRA deduction.
- Students loan interests deduction.
- Determine if you can form 1040. If you cannot use the 1040EZ or Form 1040A, you must use Form 1040. You can use Form 1040 to report all types of income, deductions, and credits. You can pay less tax by filing Form 1040 because you can itemize deductions and get some adjustments to income that cannot be obtained on Form 1040A or 1040EZ form.