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Tips for First-Time Tax Filers

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Unless you’re an accounting major, filing taxes may not be your idea of a good time. Especially if this is your first time filing, it may feel a little overwhelming. Here are a few rules and tips to make this task easier and less stressful:

• If taxes were withheld from your paycheck, even if you only earned a little money, filing your taxes can get some of that money returned to you.
• If you earned more than $10,400 in 2017, you must file a tax return.
• You’re eligible for at least three tax breaks in the years you pay tuition: The American Opportunity Tax Credit, the Lifetime Learning Credit, and the tuition and fees deductions.
• If your parent still claims you as a dependent, you must mark off “I can be claimed on someone else’s return” on your form.
• File early. Waiting until the last moment will only make the process more stressful.
• You can file your Federal taxes for free and online by going to irs.gov. There are other free filing websites, found easily through an online search.
• You’ll have to pay state taxes to each state you are a resident of during the tax year. If you attend college in one state but live in another, check the residency requirements to see if you qualify as a resident or nonresident of the state in which you attend school.

Here are the forms you’ll need to file your taxes and get your returns:
• W-2: Your employer will give this to you. It will show any taxes that were withheld from your paycheck.
• Form 1098-T: Your college will send you this tuition statement. It includes information you’ll need to claim education credits.
• Form 8863: This is another form that will tell you if you qualify credits like the American Opportunity Credit and the Lifetime Learning Credit.
• Form 1098-E: Use this to deduct the interest you paid on a qualified student loan during the tax year. Your lender will send this form to you if you paid more than $600 in interest.
• Form 1040: This is the form you need to fill out with your information to file your taxes. Blank forms can be found on irs.gov, as well as information to explain which 1040 form you need.

If you need more help with taxes, the IRS also has links to answer questions and help with more advice. Or if you happen to know an accountant that enjoys taxes, even better. Filing taxes may seem like a boring chore, but in the end the return can be very beneficial. And who wouldn’t like a little extra cash in their account?

Liberty Savings Federal Credit Union serves Hudson County residents and businesses, providing financial services with a personal mission. Our aim is to offer the lowest loan rates, least amount of fees, and the best options for saving. Contact us at 201-659-3900 to discuss any financial needs—from lending to savings to obtaining a new Visa, we’re here for you.