6 Things Millennials Need to Know About Their Taxes

If you’re a Millennial, you may not know all that you need to know about your taxes especially if you have only recently begun filing, or have not been filing for more than a few years. Try some of these tax filing strategies, to help you maximize your tax refund, as well as get it back as soon as possible.

Skip Pen & Paper, File Electronically

Most Millennials can expect a tax refund when they file their income tax returns, and it can often amount to several thousand dollars. For that kind of money, you’ll want to get your refund back as quickly as possible. The best way to do this is by filing electronically.

Electronic filing not only transfers your tax return to the IRS instantaneously, which prevents it from being “lost in the mail,” but the data is uploaded to their computers directly from software, which avoids someone mistyping in your information. Those two things can cut your wait time significantly and it’s often possible to get your tax refund back within 21 days of IRS acceptance if you use direct deposit.

Having your tax refund direct deposited into your bank account alone can cut a couple of days off the refund wait, since the payment won’t need to go through regular mail, and you won‘t have to bother making the actual bank deposit.

Tax Software Is Cheaper, Sometimes Free

This may be your first time doing your own taxes, but you don’t have take your taxes somewhere and pay hundreds of dollars to have them prepared. You most likely are one of the 60 million Americans who has a relatively straightforward tax return (1040-EZ/1040-A) so there is no reason to pay someone to do your taxes.  You may even be able to file your federal taxes for free.  TurboTax is always up to date with the latest tax laws and makes filing your taxes easy by asking you simple questions about your life and doing the calculations for you based on your answers.

You May Be Able to Deduct Moving Expenses Even If You Don’t Itemize

When you’re in your 20s and 30s, moving to take a new job is a common occurrence. But if you do, you should plan to deduct your moving expenses on your tax return. You may be able to deduct the cost of moving your furniture and personal belongings, as well as your travel costs (except for food) to the new location. This can lower your taxable income by thousands of dollars.

And you don’t need to itemize in order to take this deduction. It is taken as a direct reduction of your income.

You May Be Entitled to Education Credits and Deductions

Going back to school? You can deduct up to $2,500 in student loan interest paid from your taxable income, if your income falls within certain income limits. This is another of those deductions that you can take even if you don’t itemize.

You may also be eligible to take certain education credits. If you are still a student you may be able to take the American Opportunity Tax Credit, that offers a credit up to $2,500 off your tax liability. There is also the Lifetime Learning Credit, offering a credit of up to $2,000 for continuing education.

Double Check Your Work!

TurboTax will do the calculations for you, based on your entries, but make sure that the numbers you enter match the forms you received.

Also, check other information on your return, such as Social Security numbers, your address, the spelling of your name, and the bank account information that you enter for direct deposit of your refund. An error in this information could delay your tax refund.

Ask for Help if  You Have a Tax Question

When you are filing your taxes online with TurboTax you are not alone.  If you have tax questions, you can get them answered by TurboTax tax experts who are CPAs and Enrolled Agents.

2 responses to “6 Things Millennials Need to Know About Their Taxes”

1. 

   I have used turbo tax for he last several years and now have a new computer and new user name and password. If I use the information from 2014 my e-mail will not be right and I am told over and over as I have tried that my e-mail is wrong, but I guess I know it’s right. Please help

   Reply
2. 

   Filed Feb 6 accepted still processing called today and was told error but don’t know they said call tax advocate in 1 week can be 30 days longer

   Reply