The first time you prepare a tax return, you may feel overwhelmed and uncertain that you’re taking the right steps. However, if you stick with it, you will find that doing your taxes isn’t nearly as complicated as it appears to be. Moreover, it can be a rewarding and financially empowering experience, especially when it’s your first time filing. The following information can help you on your way to filing your first return.

The 1040EZ Form

The 1040EZ form is a common form available from the Internal Revenue Service (IRS). You can download it from their website. The form is used for single or married persons without dependents and it is quite simple to fill out. It allows you to report both your income and the amount of federal income tax you paid in the fiscal year. It is also used to determine whether you either paid too much in tax, in which case you will be eligible for a ax refund. However, if the reverse is true and you paid too little taxes, you will have to pay the remaining balance.

The W-2 Form

The W-2 form is a report of your annual wages, salary, or tips and the taxes paid on those earnings. Your employer will provide you with a copy of this form before you file your taxes. A copy of the form is also given to the Social Security Administration, which forwards it to the IRS. If you haven’t got a copy of this form come tax season, you need to contact your employer right away. If you’ve moved recently, it’s possible that the form got mailed to the wrong address.

Basic Principles

The only thing that you need to know to start doing your taxes is that when you work, you owe the government a portion of the money that you make. Most of the time, this money is taken directly from your paycheck.

The percentage that you pay depends on several factors, including your age, marital status, annual income, family status, or student status, among many other things. However, the government doesn’t ask you for this information before they take money from your paycheck. Therefore, in order to find out whether you’ve paid too much in taxes or too little in taxes, you need to file a tax return. Your return will indicate if you are eligible for a tax refund or if you have an additional balance to pay.

Tax Vocabulary

Learning the lingo is part of doing your taxes and it may not be as scary as it seems. You’ll hear people talking about “exemptions,” “deductions,” and “credits” – all of these things can factor into how much or how little tax you will pay. Spending time to research the exemptions, deductions, or credits that you qualify for according to your situation is the only way to actually decrease the amount of taxes that you pay, aside from making less money, of course. For instance, if you’re a student, you can get a deduction for the interest on your student loan, as well as credits to go towards your college tuition.