Four Tax Tips for First-Time Filers
It’s officially tax season, and for many of us students with part-time jobs or paid internships, it will also be the first time filing a federal tax return. The process of filing taxes can seem extremely intimidating and confusing to newbies, so H&R Block provided this list of tips for students and other first-time filers.
1. Should I file a tax return at all? If you earned any income in 2011, you should consider filing your taxes. If your income is higher than a certain threshold, which varies by depending on your filing status and age, you may not have a choice. Check here to find out if you are required to file a tax return. But even if you don’t have to, it’s a good idea to file a return anyways. “Workers who are not required to file a tax return because their income is below their filing threshold should file a return to get a refund of all taxes withheld and/or to claim other tax benefits, such as the Earned Income Tax Credit,” said Elaine Smith, master tax adviser with H&R Block.
2. What’s the difference between a W-4 and a W-2? Your employer is the one who fills out a W-2 form for you and will either mail or send it to you online. A W-2 reports your wages and the taxes withheld from them, and you need information from the W-2 to fill out your returns. A W-4 form, on the other hand, is filled out by the employee. It determines how much federal income tax is withheld from your paychecks. You’ll be asked to decide on the number of “withholding allowances” you want to claim. You’ll usually give this to your employer whenever you start a new job.
To see the last two tips, head over to this post on Block Talk, H&R Block’s blog.