Filing a federal income tax return is something most Americans do every year — yet many people find it stressful or confusing, especially when their situation changes. This guide walks through the process from start to finish: gathering documents, choosing how to file, completing your return, and what happens after you submit.
Step 1: Gather Your Documents
Before you can file, you need to collect records of your income, deductions, and tax payments for the year. Missing documents are the most common cause of delayed or incorrect returns.
Documents you may need:
- W-2 — from each employer, reports wages and withholding. Employers must send W-2s by January 31.
- 1099 forms — report income from freelance work (1099-NEC), interest (1099-INT), dividends (1099-DIV), Social Security benefits (SSA-1099), retirement distributions (1099-R), and other sources.
- 1095-A — if you bought health insurance through the Marketplace (Healthcare.gov), needed to reconcile the Premium Tax Credit.
- Records of deductible expenses — if you plan to itemize: mortgage interest (Form 1098), property tax payments, charitable donation receipts, large medical bills.
- Last year’s tax return — useful for reference, and you’ll need your prior-year AGI to e-file.
- Social Security numbers — for yourself, your spouse, and any dependents.
- Bank account information — routing and account number if you want your refund by direct deposit (fastest option).
Step 2: Choose Your Filing Status
Your filing status determines your tax bracket, standard deduction, and eligibility for many credits. The five statuses are:
- Single — unmarried or legally separated as of December 31 of the tax year.
- Married Filing Jointly — married couples who file a combined return. Usually results in lower tax than filing separately.
- Married Filing Separately — married couples who file individual returns. Rarely advantageous; some credits are unavailable.
- Head of Household — unmarried with a qualifying dependent you paid more than half the cost of housing for. Higher standard deduction than Single.
- Qualifying Surviving Spouse — widowed within the past two years with a dependent child; allows use of Married Filing Jointly rates.
If you’re unsure which status applies to you, the IRS has a free online tool at IRS.gov/help/ita that walks through the determination.
Step 3: Choose How to File
You have several options for preparing and submitting your return:
IRS Free File
If your adjusted gross income (AGI) is $84,000 or less, you can use IRS Free File — free tax software provided by commercial companies through an IRS partnership. Available at IRS.gov/freefile. If your income is above the limit, the IRS Free Fillable Forms option lets you complete and e-file the forms manually at no cost, though with no guidance.
Free Tax Preparation Programs
The IRS’s Volunteer Income Tax Assistance (VITA) program offers free in-person tax preparation for people who earn $67,000 or less, have disabilities, or speak limited English. AARP Foundation Tax-Aide is available to anyone but specializes in taxpayers 50 and older. Both are staffed by IRS-certified volunteers. Find locations at IRS.gov/vita or AARP.org/taxaide.
Commercial Tax Software
TurboTax, H&R Block, TaxAct, and FreeTaxUSA are the major options. Most offer a free tier for simple returns (W-2 income, standard deduction, no investment income). More complex returns — self-employment, rental income, investments — typically require a paid tier. Prices range from $30 to $150+ for federal filing, plus additional fees for state returns.
Tax Professional
A CPA or enrolled agent makes sense if your return is complex: business income, rental properties, significant investment activity, major life changes (divorce, inheritance, large asset sale), or if you’ve received IRS notices. Expect to pay $200 to $500 or more for a typical individual return prepared by a CPA.
Step 4: Complete Your Return
Whether you use software or a professional, the process follows the same logic. Your return calculates:
- Total income — all taxable income from all sources.
- Adjusted Gross Income (AGI) — total income minus “above-the-line” deductions like student loan interest, IRA contributions, and self-employment tax.
- Taxable income — AGI minus your standard or itemized deduction and any qualified business income deduction.
- Tax owed — applied from the tax brackets to your taxable income.
- Credits applied — credits reduce your tax owed dollar for dollar (Child Tax Credit, Earned Income Tax Credit, etc.).
- Payments credited — withholding already paid plus any estimated tax payments.
- Refund or balance due — if payments exceed tax owed, you get a refund; if less, you owe the difference.
Step 5: Submit and Track
E-filing is faster, more accurate, and more secure than mailing a paper return. The IRS accepts e-filed returns starting in late January each year. The standard deadline for most individual returns is April 15 (or the next business day if April 15 falls on a weekend or holiday).
After filing:
- Track your refund at IRS.gov/refunds using the “Where’s My Refund?” tool. You’ll need your Social Security number, filing status, and exact refund amount. E-filed returns with direct deposit typically receive refunds within 21 days.
- Pay any balance due by April 15 to avoid penalties and interest. You can pay at IRS.gov/pay by bank transfer (free), debit or credit card (fee applies), or check.
- File an extension if needed — Form 4868 gives you until October 15 to file, but does not extend the time to pay any tax owed. See the article on how to file a tax extension.
- Keep a copy of your filed return and all supporting documents for at least three years — the standard IRS audit window.
Common Mistakes to Avoid
- Missing income. All 1099 income must be reported even if you didn’t receive a form. The IRS receives copies of all 1099s issued to you.
- Wrong Social Security number. A transposed digit on your return or a dependent’s SSN is one of the most common causes of IRS rejection.
- Choosing the wrong filing status. Head of Household has specific requirements — many people claim it incorrectly.
- Forgetting to sign. An unsigned return is invalid. E-filing uses a PIN as a signature; paper returns require a physical signature.
- Missing the deadline without requesting an extension. The failure-to-file penalty (5% per month, up to 25%) is much larger than the failure-to-pay penalty (0.5% per month). If you can’t pay, file anyway and arrange a payment plan.
Further Reading
- Tax Forms Cheat Sheet: W-2, 1099, and More
- How to File a Tax Extension
- How to Get the Most from Tax Deductions
- What to Do If You Get an IRS Notice
- What Is a Tax Return?
- Taxes Overview
This article is for general educational purposes only and does not constitute tax or financial advice. Tax laws change and individual situations vary – consult a qualified tax professional or the IRS for guidance on your specific situation.