How to File Taxes: A Pain-Free Guide for the First-Timers and Everyone Else

We’re not going to pretend that taxes are fun. That paying them is fun. That filing them is fun. That anything remotely related to them is fun.

So, taxes are a drag. Got it. But for most people, getting our tax affairs in order isn’t actually that much of a headache. It’s just a thing we all have to do.

Here’s our friendly guide for how to file taxes. (Ibuprofen sold separately.)

How Much Do You Have to Make to File Taxes in the First Place?

Making more money is, in almost every way, a good thing. But it’s also true that the more money you make, the more taxes you’re required to pay — at least up to a point. (You know what they say: more money, more problems!)

On the opposite end of the spectrum, you may be exempt from filing a tax return if you don’t meet the IRS income threshold, which can change.

The main number to know is $12,200. That’s the income threshold whereafter filing is required for singletons under the age of 65.

But more specific requirements are determined by other aspects of your filing status, such as your marital status and whether or not you have dependents.

For instance, if you’re married and filing jointly, that income threshold doubles to $24,400 — and increases even more if one or both of you have already celebrated your 65th birthday.

The numbers also shift if you’re a qualifying widow or the head of your household.

There are many rules of thumb regarding tax filing, such as: you must always file if your paychecks have had taxes withheld and you can’t claim tax exemptions of your own if you’re a dependent.

The best way to determine whether or not you need to file a tax return is to use the IRS’s free online tool, which takes about 12 minutes and gives you a definitive answer.

How Are Your Taxes Calculated?

All right, so you’ve successfully determined whether or not you’re required to file a return.

Now for the real fun: figuring out exactly how much you owe — or are owed.

Your taxes are calculated based on a range of personal details, like how much money you made in a given tax year, how much you’ve already paid in taxes, and even your personal relationships. That is, your tax burden will vary if you’re single versus married filing jointly, or if children or other relatives depend on you for financial support. (Such people are known, in IRS-speak, as “dependents”).

Your federal income tax is determined according to income brackets, which scale up in percentage as your overall income increases. In 2018, there are seven federal income tax brackets, ranging from 10% to 37% of your income.

Rate For Unmarried Individuals, Taxable Income Over
For Married Individuals Filing Joint Returns, Taxable Income Over
For Unmarried Individuals, Taxable Income Over
For Married Individuals Filing Joint Returns, Taxable Income Over
10% $0 $0
12% $9,700 $19,400
22% $39,475 $78,950
24% $84,200 $168,400
32% $160,725 $321,450
35% $204,100 $408,200
37% $510,300 $612,350

AlaskaAlong with federal income taxes and your contributions to Social Security and Medicare, you’ll also be responsible for filing a state return and paying state income taxes, unless you live in one of the seven states that don’t levy them. Those states are:

  • Florida
  • Nevada
  • South Dakota
  • Texas
  • Washington
  • Wyoming

The other 43 states’ rates run from as much as 13% to almost nothing, and may vary by income or be assessed at a flat rate. Check with a professional in your area (or, honestly, run a Google search) to get the deets on tax laws in your state.

Deductions and Credits

You may be eligible for certain tax deductions, such as contributions to your 401(k) or student loan interest payments.

Tax deductions can add up and cut a nice chunk off of what you’d otherwise owe to the IRS, sometimes substantially increasing your refund by reducing your total taxable income. This is especially true if you’re a freelancer, in which case you can write off a whole slew of business expenses the 9-to-5 folk cannot.

You could also deduct the interest paid on your mortgage, charitable donations and more. Or, it may be in your best interest to take the standard deduction, which, for 2019, is a pretty generous $12,200 for single filers (or $24,000 for those married and filing jointly).

There are also certain tax credits you may be eligible for, such as the American Opportunity Credit, which offers eligible students up to $2,500 per year to offset college expenses, or the Child Care Credit, which offers eligible guardians up to $3,000 apiece to offset the expense of supporting a dependent.

Contributing to your retirement savings can also get you a tax credit of up to 50% of your retirement plan, depending on your contributions, account type and gross adjusted income.

Tax credits differ from deductions: while a deduction reduces your taxable income, a tax credit reduces what you owe the government, dollar for dollar.

Doing the Math

If you’re a first-time tax filer, chances are your situation won’t be too complex. You’ll likely be able to get away with the simplest version of IRS Form 1040. This document uses information about your income, withheld taxes, marital status and dependents to determine whether or not you’ll be writing or receiving a check.

Most people will fill this out using their W-2 as a guideline, which is a document issued by your employer. Your W-2 lists your total earned wages and withholdings, including federal income tax, Medicare and Social Security. It’s distributed by employers by no later than Jan. 31, and these days, it’s often digital.

The self-employed person’s equivalent of a W-2 is a 1099, although these documents don’t include information on tax withholding — because independent contractors are responsible for doing that themselves. Honestly, freelance taxes are a whole other ballpark, which is why we’ve got the full scoop for you in a separate post.

The more complicated your financial landscape is, the more complicated your filing will be, and the more forms you’ll need to add to your pile. For example, if you have additional sources of income through capital gains, unemployment compensation, gambling or prizes, you’ll need to file a Schedule 1 along with your 1040.

There are also additional forms for those who owe self-employment tax or can claim a refundable credit. (The IRS helpfully lists some of the most common additional-filing scenarios, and the necessary documents, on its “About Form 1040” page.)

Of course, dragging out your calculator and working out your tax burden longhand is only simple in theory, even under the most straightforward circumstances — which is why many people turn to tax software or professional services to help make taxes less of a chore. These costs range from a few bucks on a digital filing upgrade to putting an accountant on retainer.

How to Actually File Your Taxes

Now that you’ve got the hard part out of the way, it’s time to put away the calculator and actually file your income tax return. You’ve got a number of options, some of which are more convenient (and costly) than others.

You may:

E-file using the free IRS tool. This is a good option for those with relatively straightforward taxes, especially if you make less than $66,000. (Those who earn more than $66,000 can still use the tool, but the software only does basic math for you, and state tax prep is not available.)

E-file using a private tax software service, like TurboTax or H&R Block. Most of these services offer a free filing option, and they make the process super simple: just fill out some forms, click some buttons, and your tax return whooshes off, no problem.

The free service goes for basic federal and state taxes, making it more comprehensive than the IRS tool. However, if your financial situation is more complex — for example, income including mortgage interest or rental property profit — you may have to move into a paid tier, with fees running from about $80-$100.

Go old-school with paper filing, sending actual, hand-filled-out paper forms to the IRS in the mail, like the all-analog hipster you are. Paper filing is pretty cheap, of course, but it’s also a great way to make errors on your return if you’re not a tax wizard. But if you’re confident in your calculator-fu, here’s the full list of paper filing IRS mailing addresses by state.

Hire a tax professional. Although it’s easily the most expensive move on this list, it’s also the least stressful — and if you make enough to cover it without too much budgetary shuffling, it might just be worthwhile. A certified accountant or tax preparer can ensure you get the most generous refund possible… and best of all, your calculator can stay firmly ensconced in its layer of dust.

Once you’ve filed, you’ll receive your tax refund — if you’re due one — within about four weeks, either by paper check or direct deposit. Similarly, if you owe taxes, you can pay through the digital system via direct transfer or credit card, or mail off a paper check to the correct address for your state.

Be sure to account for your state taxes, as well, which may need to be shipped to a different address — which you’ll find on your state’s official taxation and revenue department website.

Although Tax Day is nobody’s favorite holiday, we hope this post has helped you see that filing taxes doesn’t have to be a total nightmare. And besides, for many filers, all that paperwork does have a silver lining: a fat tax refund check, just in time for summer.

Of course, as tempting as it is to spend that refund on airline fare or tacos, the smartest move is to find ways to turn it into even more money — which means even more tacos down the line. Here are some of our best ideas for what to do with your tax time windfall.

(I’d like to add an additional suggestion: use it to hire an accountant!)

Jamie Cattanach’s work has been featured at Fodor’s, Yahoo, SELF, The Huffington Post, The Motley Fool, Roads & Kingdoms and other outlets. Learn more at

This article originally appeared on The Penny Hoarder