Filing taxes in the United States is frightening for two reasons: the system is genuinely complicated, and there is an entire industry making a living off your fear of it. This guide separates out what actually matters.
Who has to file
If you worked in the United States during the year and your income was above a certain threshold, you must file a return. The threshold changes every year and depends on your filing status and age.
Two things people confuse:
- Filing is not paying. Most people with low or moderate incomes get a refund, because too much was withheld during the year.
- Having no SSN does not exempt you. You file with an ITIN. In fact, filing is what builds the history that almost everything else later asks for.
What to gather
- W-2, if you are an employee. Your employer must give it to you by January 31.
- 1099-NEC, if you were self-employed and paid above a certain amount.
- 1098-T, if you studied.
- Receipts for deductible expenses, if you plan to deduct.
- Your number: SSN or ITIN, yours and your dependents’.
If you were paid in cash and nobody gave you any form, you still have to report that income. It goes on Schedule C, as self-employment.
The credits almost nobody claims
This is where the real money is:
- Child Tax Credit. Per dependent child. The child must have an SSN, even if you file with an ITIN.
- Credit for Other Dependents. Smaller, but it does apply to dependents with an ITIN.
- Education credits. American Opportunity and Lifetime Learning, if you or a dependent studied.
- State and city credits. New York has its own, including one for child care.
The EITC (earned income credit) is the largest of them all, but it requires an SSN valid for work: it does not apply with an ITIN. Anyone promising it to you is the first sign of a scam.
Where to file for free
Paying $400 for a simple return is unnecessary. There are three free routes and all of them are legitimate.
- VITA. IRS-certified volunteer program for incomes below a set level. There are sites in all five boroughs and several serve Spanish speakers.
- NYC Free Tax Prep. The city runs its own program, in person and online.
- IRS Free File. Free software if your income is below the threshold.
Tax-season scams
The three most common in our community:
The preparer who promises a fixed refund. “I’ll get you $6,000 back.” Nobody can know that before seeing your documents. They typically inflate fake deductions, charge a percentage of the refund and disappear. The legal liability stays with you.
The preparer with no PTIN. Every paid preparer must have a PTIN and sign your return. If they refuse to sign, do not use them.
The “IRS” phone call. The IRS does not call demanding immediate payment, does not ask for gift cards and does not threaten deportation. It always contacts you by mail first.
If you did not file in past years
You can catch up. Filing late is better than not filing: the penalty for failure to file is larger than the one for paying late, and payment plans exist. You can file several years of back returns and, if you were owed a refund, you can still claim it within a limited window.
One important note
This guide is informational and does not replace advice from an accountant. If your situation involves income in two countries, a business, or questions about how filing affects a pending immigration process, get professional help before signing anything.
