Tax Filing 101: Forms and Facts You Need to Know
As we get closer to the tax filing deadline for the United States, it is important to know the intricacies and important forms for filing taxes.
The Internal Revenue Service (IRS) started accepting and processing returns from January 23rd, 2023 for the 2022 tax year. The last date to file the federal tax returns for 2022 is April 18th, 2023. This is also the late date for requesting an extension of 6 months through Form 4868.
Form W2, Wage and Tax Statement:
If you were employed during the 2022 calendar year, you will most likely receive a Form W-2 if the remuneration is $600 or more. This will indicate any income, social security, or Medicare taxes withheld. If you claimed no more than one withholding allowance or did not claim exemption from withholding on your Form W-4, your employer is also required to file a Form W-2 for you. Make sure to review your Form W-2 to ensure that it accurately reflects your income and withholdings before filing your tax return.
Form 1098-T:
Form 1098-T is a statement that colleges and universities are required to issue to students. It provides the total dollar amount paid by the student for what is referred to as qualified tuition and related expenses in a single tax year. The University is required to provide you Form 1098-T if you are enrolled in credit-bearing courses. This form is used to determine the deduction for one of two education tax credits. University Bursar has a web page dedicated to Understanding Your Form 1098-T.
Filing Taxes in more than one State:
If you earn income in another state, you may need to file tax returns in both your state of residence and the state where you have earned the income from.
Important points to remember:
Determine your tax filing status:
Your tax filing status is based on your marital status and whether you are considered a dependent on another taxpayer. If neither applies to you, you will be considered as a single taxpayer.
Gather all your documents relating to tax filing:
You will need to keep your forms like W-2 from any jobs you had during the year and Form 1098-T from the University.
Determine if you are eligible for education credits:
You may be eligible for tax credits which can help you offset tuition fees and other expenses. These credits are based on the income levels and the cost of tuition.
Consider using a financial professional or a tax filing software:
Tax filing can be complex, especially with tax credits and deductions. Consider using a financial professional or a tax filing software to help filing tax returns. The webinar on Choosing a Financial Pro can help you choose a tax professional based on your needs and wants. The IRS also has information on how to choose a tax professional.
Free Tax Prep & Helpful Services for Qualifying Taxpayers
IRS Free File is a great resource for the Do-It-Yourself option.
Ladder Up Virtual Tax Assistance Program is available for individuals earning up to $32,000 or couples earning up to $60,000 (as of 2022 tax filing season).
VITA Free Tax Return Preparation for Qualifying Taxpayers. Locations and limitations vary. Use the Locator Tool to find IRS VITA Sites.
University of Illinois Urbana-Champaign's College of Business hosts a VITA site in Urbana each spring which serves the local community and domestic students.
United Way’s My Free Taxes is available for taxpayers that earn less than $60,000 (as of 2022 tax filing season).
International Students are provided tax-filing software through their respective international student support office at each University in the System:
Remember, not filing your taxes on time can trigger interest charges and penalties.
The Tackling Taxes module in Earn badge will help you understand many more aspects of taxes in addition to the information on our Taxes web page.
