Filing taxes can be intimidating when you haven’t done it before. Whether you’re expecting a tax refund or owe taxes, our step-by-step guide breaks down exactly how to file taxes for the first time.
1. Know if you need to file this year
First, determine if you even have to file your taxes this year. If you’re single with no children and had a gross income of $13,850 or more in 2023, you have to file.¹
Whether you need to file or not depends mainly on your income, age, and filing status. Review the IRS filing requirements, which lay out the criteria for whether or not you’re required to file. You can also use this handy tool from the IRS to find out if you’re required to file taxes or not.
Chime tip: If you’re a first-time tax filer, check out this tax terms glossary to learn the terms you might come across.
2. Gather your necessary tax documents
When preparing to file taxes, you need to gather your income documents, including W-2 form(s), 1099 form(s), and/or K-1 form(s). You should also collect your personal documents, including your Social Security Number or Taxpayer Identification Number, personal identification (with your name and birth date), and your financial account information.
|Who it’s for:
|When to use:
|To report income earned, including wages and tips
|Freelancers or independent contractors
|If you received $600 or more in payments from a client during the year
|Anyone with interest-earning bank accounts
|If you earned over $10 in interest during the year on an interest-bearing account (e.g., savings account, certificates of deposits, or money market accounts)
|Shareholders of corporations
|If you own stocks or investments and received dividend payments totaling $10 or more
|Anyone who received government payments
|If you received unemployment benefits or a state tax refund during the year
You use income tax documents to report all earned income for the tax year. You’ll need to fill out different forms depending on your different sources of income. Here are some of the most common income forms to know:
- W-2 Form: If you’re an employee, your employer provides this form that lists your wages and taxes withheld.
- 1099-MISC: If you’re a freelancer, independent contractor, or otherwise self-employed, you should receive this form from each client who paid you $600 or more.²
- 1099-INT: If you have a bank account that earns interest, like a high-yield savings account or certificate of deposit (CD), use this form to report any interest earned.
- 1099-DIV: Use this form to report dividend income earned from investments you own, such as stocks or mutual funds.
- 1099-G: If you received government payments like unemployment benefits, you’ll report those payments on this form.
- K-1 Forms: You’ll receive these if you’re a partner in a partnership or shareholder in an S-corporation.
You’ll need the following personal information on hand to file taxes:
- Social Security Number (SSN) or Taxpayer Identification Number (TIN) for yourself and any dependents
- Full name and date of birth for all individuals on your return.
- Proof of identity with a valid photo ID
- Bank account information, including your routing and account numbers, if you want to receive your tax refund via direct deposit.
3. Determine your filing status and dependency status
Your filing status affects your tax rates, how you report your income, and the credits and deductions you can claim. Also, knowing whether your parents can claim you as a dependent on their tax return can significantly impact your filing status.
What is my filing status?
Here are the five primary filing statuses:
- Single: If you’re unmarried.
- Married (filing jointly): For married couples who want to combine their income on one return.
- Married (filing separately): For married couples filing separately.
- Head of household: For unmarried individuals who support dependents.
- Qualifying widow/widower with dependent child: If you’re a surviving spouse with a dependent child.
When you file your taxes, include the appropriate filing status on your forms.
Can I be claimed as a dependent (or claim a dependent)?
If you still live with or receive financial support from your parents, they may be able to claim you as a dependent. Even if you’re filing your own taxes, ask your parents or guardians if they plan to claim you as a dependent on their tax return. This way, your parents can take advantage of the tax benefits of having a dependent.
What happens if I’m claimed as a dependent?
You can’t claim a personal exemption on your tax return if someone claims you as a dependent. However, it can provide certain tax benefits for the person claiming you, like qualifying for head of household status or eligibility for certain tax credits.
4. See if you qualify for tax deductions and credits
Tax deductions and credits can help reduce your tax bill or increase your tax refund, so you want to find out if you qualify for any before you file.
Below are some common tax deductions and credits that you may qualify for. Review all available credits and deductions on the IRS website to see if you qualify.
Family credits and deductions:
- Child Tax Credit: A credit that provides financial relief to parents by reducing their tax liability for each qualifying child.
- Child and Dependent Care Credit: This credit helps offset the cost of child care expenses.
- Earned Income Tax Credit (EITC): Geared toward low to moderate-income individuals and families, the EITC is a refundable credit designed to supplement earnings.
- Adoption Credit: A credit that assists with the costs associated with adopting a child, including adoption fees, court costs, and travel expenses.
Education credits and deductions:
- American Opportunity Credit: This credit supports the cost of qualified higher education expenses during the first four years of post-secondary education.
- Lifetime Learning Credit: A credit that helps cover the costs of post-secondary education, including tuition and related expenses, for eligible students.
- Student loan interest deduction: This deduction allows you to deduct the interest paid on qualified student loans.
- Educational expenses deduction: This deduction covers certain educational expenses.
Homeowner credits and deductions:
- Home Energy Tax Credits: A credit for homeowners who make qualifying energy-efficient home upgrades.
- Energy Efficient Home Improvement Credit: A credit for homeowners investing in energy-efficient home improvements.
5. Decide where to file
Once you’ve gathered your necessary documents and understand your filing status, it’s time to decide where and how you want to file your taxes. Here are some options to consider:
Perhaps the most convenient and popular method, filing your taxes online is a straightforward process. There are a variety of online platforms to choose from, and many of them are free. One official option is IRS Free File.
Filing with a tax professional
If your tax situation is complex or if you’d prefer professional guidance, you can work with a tax professional like a certified public accountant (CPA) or an enrolled agent. This option may come with a fee, and the total cost depends on the tax preparer and how complex your tax situation is.
Filing through nonprofit organizations
Nonprofit options like the Volunteer Income Tax Assistance (VITA) program and Tax Counseling for the Elderly (TCE) program can help you prepare your taxes for free if you qualify. Check with local organizations or visit the IRS website to find a VITA or TCE near you.
While less common today, you can still file your taxes on paper by obtaining the necessary tax forms and mailing them to the IRS. Filing your taxes by hand is typically more time-consuming and may delay your tax refund, but it’s an option if you prefer a traditional method.
6. File your taxes
Once you’re ready to file, review your tax return for accuracy. Check that you’ve reported your personal information, income, deductions, and credits correctly.
- Filing online: There should be prompts to verify information within the platform you choose. For an easier process, check the accuracy of the information on each page before clicking to the next one.
- Filing with a tax professional: Tax professionals are responsible for checking their work, but make sure you’ve provided them with the correct information upfront. Request they walk you through it for added peace of mind.
- Filing through nonprofit organizations: If you’re working with a nonprofit organization, you may need to attend scheduled sessions in person and bring all necessary documents so they can help you submit your return.
- Paper filing: Carefully complete all required forms, attach supporting documents, and mail the package to the appropriate IRS address. Double-check for accuracy and include a signed copy of your return.
Remember to file your signed and dated return by the tax deadline to avoid any late penalties. The deadline to file 2024 taxes is April 15, 2024.³
Chime tip: Set up direct deposit with the IRS to get your refund sooner. It’s secure, eliminates the risk of lost or stolen checks, and ensures that your money is available to you as soon as the IRS processes your refund.
No matter your filing method, you can select direct deposit as your refund method when filing your taxes. Input your bank account number and routing number for the account where you’d like to receive your refund.
7. Pay the IRS if you owe taxes
After filing your taxes, you’ll either receive a tax refund or a notice of the amount you owe to the IRS. If you end up owing money, you may not have withhold enough taxes from your paycheck throughout the year.
In this case, you’ll need to know how to pay what you owe. You have a few options:
- Use IRS Direct Pay: This online service lets you pay your tax bill directly from your bank account. It’s a secure and convenient way to pay the IRS without any fees.
- Pay with a credit or debit card: You can pay your taxes using a credit or debit card through authorized payment processors, but this method includes fees.
- Pay in installments: If you can’t pay your tax bill in full, you may be eligible for an installment payment plan with the IRS. This allows you to pay your tax debt over time in manageable installments.
Whichever method you choose, pay what you owe on time to avoid any penalties.
Conquer your first tax season confidently
Whether you expect a refund or owe taxes, be proactive for a smooth tax season. Take the time to gather your documents, understand your filing status, and explore potential deductions and credits that can maximize your refund.
To get your refund as soon as possible, don’t forget to set up direct deposit through Chime for a faster refund.
Before you file your taxes, learn how to find out what tax bracket you’re in.