It's tax season and a lot of people are feeling nervous about filing.
A survey from NerdWallet found 83% of tax filers are worried about repercussions if they make a mistake. Broken down by generation, Gen Z is the most concerned about this with 20% worrying about facing criminal or fraud charges for an incorrect tax return.
There are three things NerdWallet suggests to avoid mistakes.
1. Check for any tax filing updates on the IRS website
"Recently they updated the standard deduction as well as tax brackets. So these are things that you want to research before you file your taxes as well to make sure that your information is current and up to date," said Elizabeth Ayoola, a personal finance expert with NerdWallet.
2. Hire a tax preparer
This option does cost money, but it can save you the worry. Just make sure you verify that the tax preparer is qualified first.
"So maybe a certified public accountant or anyone who has a certification. I remember I once used someone, and I didn't research their credentials, and I ended up being audited as well as the tax preparer. So that's something to keep in mind," said Ayoola.
3. Use the free IRS tax filing service
This is only an option if you made $79,000 or less last year.
"This might be helpful to people because it can help mitigate the occurrence of mistakes, and also, it's free," said Ayoola. "People should keep in mind though, that usually it's free for federal taxes but it's not always free for state taxes."
If you made over the $79,000 threshold, online tax filing software that you pay for will give you the same guidance. But if you do file on your own like this, NerdWallet points to a few key things to focus on:
- Don't take any deductions or credits that you're not eligible for.
- List out all of your income.
- Make sure your tax filing status is correct.
