100th anniversaries are usually something to celebrate, but few will rejoice on April 15, 2013. In the next week, it will be 100 years since the enactment of the 16th Amendment and the start of the annual ritual of filing Federal income taxes.
Some college students will find April 15th to be no different than any other day. Many others will be spending anxious time over the next several days trying to locate their W-2’s and figuring out the right software or forms to file their taxes on time and accurately.
DigitalMediaIX recently surveyed college students on taxes and found that 29% do not even need to file taxes, while 44% rely on Mom or Dad to do it for them. Another 11% depend on a tax preparer, so other than assembling some documents, they don’t have much to worry about.
What about the remaining 16 percent? Some of these students may be starting to panic as the deadline to file taxes is less than a week away.
The good news is that there are plenty of resources to make the process easy and panic-free. On top of that, most college students have fairly simple tax issues and concerns, making the process not quite as daunting as it may seem. Here are four tips for students who want to get their taxes filed on time:
Organizing information is very important, but for most students, it’s fairly simple. If they worked a job in 2012, they will have already received a W-2 from their employer. This will have most of the information they need to prepare both the Federal (IRS) taxes and file state taxes. It becomes a little more complicated if they have deductions for donations or received scholarship money.
The second consideration is whether it is necessary to file taxes in one or more states. Each state in which you receive income means filing tax forms for that state. Of course, if a student worked in one of the seven states with no income tax, he would be exempt, and not have to file.
A third consideration is whether to use the forms provided by the state or IRS to file taxes. Often these are PDFs and interactive making them very simple and easy to fill in and complete. If software is the direction you want to go, this might be a good option because for the most part, the tax software is free! Over the years, the IRS has partnered up with various software companies in a program called Free File, which provides the tax software for free. Students can choose the brand of software they want and provided they qualify, will not have to pay. The Free File site http://goo.gl/uNY5V lists 15 companies, including the industry leaders like TurboTax, H&R Block, and Tax Slayer, which provide software at no cost.
Finally, if you received a scholarship, you have to be careful to account for this money properly. You don’t have to pay taxes if your scholarships are used for tuition costs and required fees. However, any scholarship money spent for room and board, travel, research, and equipment is considered wages and is taxable.
If you are still having difficulty completing taxes, many universities have free assistance. Search the campus directory for more information.
By using the right resources and putting in a little time and effort, completing taxes really isn’t too challenging. Although students may not be very enthusiastic for April 15th, filing taxes on your own for the first time is definitely something worth celebrating.
Photos Courtesy of UW-Madison Archives
