Tax deadline approaching, but students don’t need to stress
April 3, 2008
April 15 is the deadline for working Americans to submit their tax information to the state and federal governments.
Tax time can be stressful for a lot of people, especially students, but for most students the process is easier than they think.
“It’s really not complicated,” said Bob Casey, office manager at WESTconsin Credit Union and UW-River Falls alumnus.
Students who earned income and had taxes withheld from that income are required to fill out tax forms, Casey said.
For younger filers, the taxing process is much simpler than for older adults who have to report such things as property taxes, stocks, mutual funds and other financial situations which require more care in reporting to the IRS.
“Most college students with primarily wage and interest income should be able to easily complete and file their own federal tax returns within an hour,” Dawn Hukai, associate professor of business, said in an e-mail.
Since students generally don’t make enough money in a year to have to pay more taxes than are withheld from their paychecks, the biggest reason perhaps to submit the forms is to get the refund check.
However, there are other reasons to file, besides avoiding an audit and possibly legal action. Students who apply for financial aid need to have their taxes done before completing a FAFSA application. This year also, the federal government is offering an economic stimulus to taxpayers who meet a set of requirements.
The economic stimulus is a “payment that more than 130 million households will receive starting in May,” according to the IRS Web site.
Nearly everyone who files 2007 income taxes will receive the stimulus, as long as they meet three requirements.
“You’re eligible if you have a valid Social Security Number (SSN), can’t be claimed as a dependent on a tax return and have either an income tax liability or “qualifying income” of at least $3,000,” according to the IRS Web site.
Individuals may potentially receive $300 – $600, while married persons stand to receive up to $1,200.
Tax preparation itself is less intricate than the rumors would indicate.
“The math involved is primarily adding and subtracting amounts on the forms, and you are allowed to use calculators and computers,” Hukai said.
“Some of the common mistakes are adding mistakes,” Casey said.
Even if students make a mistake on their tax forms, the consequences are usually not terrible.
“The IRS and states will automatically fix obvious math errors eventually and send you a bill/refund for additional amounts due along with fines and interest,” Hukai said.
Hukai also said that students may be audited at random and informed of it after the fact. Students, for the most part, are not filing the complex forms that would trigger a more intimidating audit process.
“The sample of people who get audited is very small,” Casey said.
“I have never had a student ask me about a full-blown individual tax compliance audit yet,” Hukai said.