This Monday, April 18, is Tax Day in the United States. For some of you, this may be nothing more than a “holiday” that shows up on your Google Calendar, which you ignore and move on with your day. This is because the American public school system in general does a terrible job of educating K-12 students on issues that can have an immediate and practical impact on their lives, like taxes.
During my senior year of high school, my AP Economics teacher ran a volunteer-based tax filing center out of his classroom after school hours on his own time. He spent the month of February teaching our class everything we needed to know about filing taxes in the U.S. I took this knowledge and volunteered throughout the months of March and April, filing the taxes of people from the community.
These three months taught me more practical life skills than the rest of my four years of high school combined, and I firmly believe every student should have the same experience I did. However, since this is not the case, here are answers to some of the questions you may have about filing your taxes in 2022.
What is Tax Day?
This is the last day a mailed tax return can be postmarked and sent to the Internal Revenue Service (IRS) before it is considered late, which can result in a “failure to file penalty.” If you owe taxes, these penalties can increase your bill by 25% or more, and if you were owed a refund by the IRS, a failure to file can nullify that credit.
How do I know if I need to file?
In 2022, the standard deduction for a federal tax return is $12,550 for people filing as single (not married), and $25,100 for people who are married and filing jointly. The standard deduction is the amount of money you can make in a year without owing taxes to the Internal Revenue Service (IRS).
If you made more than this amount in the last year, you are legally required to file a tax return. If you fail to do so, you will be subject to a 5% penalty on top of whatever you owe, compounded monthly until you submit your return. If you made less than the standard deduction, you are not legally required to file taxes. However, you might still want to. If your employer has been withholding federal income tax from your paycheck and you end up with less earned income at the end of the year than the standard deduction, you are entitled to those withholdings as a lump-sum refund.
What do I need to have in order to file my return?
You may have heard of the W-2 form, the W-9, the 1099-MISC or any number of IRS tax forms. Any and all of these that you have will be necessary for completing your tax return.
If you worked a regular job with a regular paycheck, most likely you will have received a W-2 in the mail (probably sometime in January) to whatever address your employer had on file. Some jobs also allow you to request your tax forms digitally, so look into it if that appeals to you. If you worked a volunteer job with a stipend, you will receive this income on a 1099-MISC form. If you earned interest on your savings or another account such as a Certificate of Deposit, this income is reported on a 1099-INT. The 1098-T form is particularly useful for college students to know about, since it allows you to calculate applicable fee deductions for qualifying tuition-related expenses paid throughout the year. This is just a sample of the forms you may have; the complete list can be found at irs.gov.
What income do I report on my 2022 tax return?
The 2022 tax return covers any income you earned in the 2021 calendar year. This includes income from “official” jobs in which employers withheld taxes, “unofficial” jobs in which you were paid cash under the table, interest you earned on your savings, dividends on your stock portfolio, selling your cryptocurrency or a winning bet at the racetrack. It all counts.
How do I know if my employer has been withholding taxes?
Take a look at your paystub. If your employer gives you a full income distribution along with a check you should be able to see something along the lines of “income tax withheld” or “federal taxes.” It will also usually tell you how much was withheld in the current pay period, and how much has been withheld all year (YTD).
If you receive your checks through direct deposit, this information should be in your employer’s virtual payment hub. For example, for Lewis & Clark student employees who receive their payments through Workday, there is an option under the “Pay” header to choose payslips, and you should be able to see all of this information.
If my employer is not withholding taxes, do I still need to file a tax return?
This depends. If you only have the one job, you made less than $12,550 in the last year and your employer did not withhold taxes, then you are not legally required to file and probably will not receive a refund. However, if you work more than one job, and one employer withheld taxes and the other did not, you may still be required to file.
The IRS needs to know all of the money you made in the last year, so if the income from all of the jobs you work combined is more than $12,550, you do still need to file. The good news is whatever was withheld by your employer still counts against the debit you would owe.
What about a state return?
This will not apply to everyone, but for those who worked jobs in 2021 in places with a state personal income tax, you may need to file a state tax return as well as your federal return. For college students this gets even more tricky, because you may have worked one job in your home state over the summer, and another in Oregon while at LC. If both of these jobs withheld state income tax, and you made more than the standard deduction in those states (this is different than the federal standard deduction, make sure to google what your state’s standard deduction is) or you made less than the standard deduction and you want your refund, you will need to file a state return.
How do I actually get my return to the IRS once I decide to file one?
Once you have all of your forms together and you have decided to file a tax return, you have a couple of options. If you have a free service like VITA available to you, use that. You can also pay companies like TurboTax or H&R Block to have someone file your return for you. This is another great option.
However, if you feel like filing the return yourself, all you have to do is google “IRS form 1040,” and a fillable PDF will be your first result. The IRS form 1040 is the tax return itself, and it reads sort of like a worksheet. Make sure to follow each instruction on every line in order. It will ask you to add and subtract, and maybe reference other forms you will have to look up, such as Schedule 1 if you have additional income not from a W-2, or Schedule C if you have been self-employed.
These also read like worksheets, and they can seem complex at first glance, but there are instruction manuals for each form on the IRS website. Once you have made your way through all of the lines, make sure to sign and date the form, and mail it off to the IRS.
Doing taxes is complicated and required by law, yet most of us have no idea how to do them by the time we get to college and actually start working. However, since we cannot change the past, we have to teach ourselves, starting now, and help each other get back the money that we earned throughout the past year. If you neglect to file your taxes, the government will legally be able to keep money that is rightfully yours.
For anyone who decides they want to file their taxes before the deadline on Monday and has the forms they need in hand, please email me if you want some help. For those of you who feel more exhausted and depleted than you did when you started reading, I understand, and I will see you in 2023.
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