One of the least fun parts of adulting is filing taxes. But don’t worry, we’ve got your back! If you’re a first-time tax filer, here are three things you can do now to make taxes a lot less stressful.
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Don’t wait to get your tax info together
This is the biggest tax hack no one talks about. Scrambling to dig up all your financial records after the fact is a huge hassle, but a little forethought can solve the problem of missing receipts and inaccurate guesses.
Hold on to things like medical receipts, records of business expenses and transportation costs, and anything else that might come in handy. Your storage solution doesn’t have to be complicated: something as simple as a folder or box is fine.
If you’re self-employed or a small business owner, you may want to keep a notebook or spreadsheet to jot down your business income and expenses.
When you get your influx of tax forms in January, put those in with your other receipts and records right away, so you can keep them all together and not lose track of them.
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Figure out your filing and dependent status
Before you can file your taxes, the first thing you need to know is whether or not you’re a dependent of anyone. Did your parents or someone else pay for more than half of your expenses this tax year? If the answer is yes, you’re considered a dependent, and you’ll need to mark this on your return.
The other thing you need to figure out is your filing status. This may seem pretty self-explanatory, but it’s important to get right so you can qualify for the largest deduction and most credits possible.
File as single if:
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You’re unmarried
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You don’t qualify for any other filing status (such as head of household)
File as married filing jointly if:
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You’re married
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You and your partner are filing together (you’ll typically pay less this way)
File as married filing separately if:
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You’re married
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You want to file separately from your spouse
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You don’t want to deal with your spouse’s liability
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You want to keep your finances separate from your spouse’s
File as head of household if:
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You’re considered unmarried on Dec 31 of the tax year for which you’re filing (or if your spouse didn’t live with you for the last six months of the tax year)
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You paid more than half the cost of your household
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A dependent or other qualifying person lived with you for at least half of the year
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File ASAP
No, you don’t have to be at your desk, return in hand, ready to file on January 23rd, but nor should you wait until the last possible second (2023 taxes are due April 18). Even if you don’t expect your return to take too long, it’s much better to get it done sooner rather than later.
Doing so will help relieve a lot of stress, and give you extra time if anything comes up—plus, it means you’ll get your refund sooner. Now that’s something to celebrate!