Tax season starts Friday. Are you prepared?
Tax season is just around the corner and it’s time to start compiling those financial documents. While many students are not required to do so, it’s important that every college student file their taxes. According to tax consultant Margaret Munro, “If you are required to file, you absolutely must. If you’re not required to file because your income was low, you may want to file because you may have had taxes withheld that you can’t get back without a tax return.” These College News tax tips will help make for a stress-free filing.
1. Preparation: Gather all of your important financial documents and file them together so that they are easily accessible when it comes time to file. Employers are legally obligated to send out W-2 forms by January 31st. Find out whether or not parents can claim you as a dependent, as it will affect your filing as well.
2. Research: College students often don’t realize that they may qualify for tax credits. The four most important tax credits for students are the American Opportunity Credit, Lifetime Learning Credit, student loan interest deduction and tuition and fees reduction. Most students qualify for one, if not all of the credits and looking into the requirements often means a hefty refund, even if the student is not employed.
3. Scheduling: It’s long been a joke that people wait until the last minute to file taxes, but it is important to start early and set aside time to file. As soon as a student has gathered all of the necessary info, there is no need to wait. Whether e-filing or going the traditional route and filing paper forms, the sooner a student files, the sooner they will see a refund check. Traditional filing sees a refund in six to eight weeks and e-filing can see a refund direct deposited in as little as 72 hours.
4. Resources: Need help filing? E-filing is the easiest route and most tax companies offer completely free basic packages (which will suffice for most students). Not only that, but if there is any confusion or questions, most college campus accounting departments offer free tax help.
Like all things college-related, filing taxes takes time and preparation is key. Not only that, but filing early and while in college sets a good financial precedent and prepares the student for life as an adult outside and academic institution