
Common Errors New Yorkers Make When Filing Their Taxes And How To Avoid Them
A recent survey conducted by Talker Research and TurboTax to understand Americans' knowledge of tax filing. The survey reveals significant gaps in knowledge across all generations, with misconceptions about what can be written off, who needs to file and when to file.
As January kicks off a fresh year, it marks the beginning of tax season—a time that can feel daunting for many. Taxes may seem complicated, but understanding the basics and using the right tools can make it easier to make sure you get the maximum refund. Here are some misconceptions about tax filing according to the survey.
Tax Filing Common Misconceptions:
- 17% of Gen Z believe they can write off anything as a business expense. Only expenses necessary and directly related to the business qualify.
- 20% of Gen Z think students don’t need to file taxes. Many students are eligible for refunds or credits even if they earn below the IRS threshold.
- 13% of Gen Z believe income paid in cash is tax-free. All income must be reported.
- 27% of Baby Boomers think filing isn’t required if income is below IRS thresholds or that refunds aren’t possible without meeting those thresholds but refundable credits like the Earned Income Tax Credit (EITC) can benefit many low-income taxpayers.
- 25% of Millennials and Gen X believe immigrants don’t pay taxes. Immigrants are required to pay taxes on U.S. income.
How to File Taxes in New York
Tax season opens on January 27, 2025 in New York, with returns due by April 15, 2025. Here's how to prepare:
Organize Your Documents
- W-2 from your employer
- 1099 forms for freelance or contract work
- Records of deductions like student loan interest or medical expenses
- Documentation of business expenses if you’re self-employed
- New Yorkers claiming specific credits, such as the Empire State Child Tax Credit, should also have relevant documents ready
Read More: New in 2025: What You Need to Know About New York's New Laws
Utilize IRS Online Tools
- Create an IRS Online Account
- View your adjusted gross income and transcripts
- Request an Identity Protection PIN
- Make or track payments and set up plans
- Bookmark tools like the Tax Withholding Estimator to adjust payroll deductions
Free Filing Resources
- New York's Free File Program offers no-cost online tax preparation for eligible residents
- Use Direct File to e-file both state and federal returns for free
Take Advantage of Direct Deposit
- Combining e-filing with direct deposit is the fastest way to receive refunds.
- Direct deposit eliminates risk of lost or stolen checks and typically gets you your refund in less than 21 days
- Direct deposit is also available for prepaid debit cards or banking apps with routing and account numbers
Check for Deductions and Credits
- Standard Deduction: A set amount based on your filing status, reducing taxable income.
- EITC: Designed for low- to moderate-income workers.
- Child Tax Credit: A refundable credit for parents
Choose the Right Filing Method
- Do-It-Yourself (DIY): Tax software platforms like TurboTax and H&R Block guide you through filing step-by-step.
- Professional Assistance: If you have a complicated financial situation or multiple income streams, a tax professional can help with accuracy and maximizing your refund
- Free Resources: New York offers the Free File Program, which provides eligible residents access to online tax preparation and filing at no cost
Tax Filing Habits:
- 23% of Gen Z and 28% of Millennials file their taxes independently
- 54% of Millennials and 50% of Gen X use online tools
- 32% of Gen Z turn to parents for help
- 44% of Baby Boomers use tax software, while 22% prefer professionals
Filing Timelines:
- 57% of Americans file by the end of February
- Only 13% wait until April
If filing taxes feels overwhelming, there are options for help:
- Volunteer Assistance: The Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs provide free filing help for those eligible
- Tax Professionals: Use the IRS Directory of Federal Tax Return Preparers to find a certified preparer
File Early, Stay Organized and Make a Plan
Nearly 57% of Americans file their taxes by the end of February, and for good reason. Filing early:
- Reduces stress
- Ensures faster refunds
- Gives you time to address any issues
Waiting until April increases the risk of missing deductions, making errors, or scrambling for documents.
The IRS Get Ready campaign encourages taxpayers to:
- Use the IRS Online Account for quick access to tax-related information.
- Organize documents to ensure accurate filing and avoid errors that delay refunds.
- Opt for direct deposit to receive refunds securely and quickly.
Read More: New in 2025: What You Need to Know About New York's New Laws
Make a plan on how you will use or save your refund. According to a recent survey, most people plan to use their refunds to pay bills (46%), save (43%), or cover necessities like food and repairs (33%).
What’s New for Tax Filing in 2025?
- Digital Tools: The IRS is make filing easier with improved access to electronic notices and language preferences
- Savings Bonds: The IRS no longer allows purchasing paper savings bonds with tax refunds after January 1, 2025, but electronic bonds remain available on TreasuryDirect
- Split Refunds: Taxpayers can allocate refunds across multiple accounts for savings and spending.
Tax season can be manageable with preparation and the right tools. By organizing documents, leveraging resources, and understanding tax laws, you can navigate 2025 with confidence and possibly enjoy a significant refund. Start early to reduce stress and make the most of tax season.
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