The Millennial Tax Trap

Millennials are defined as the generation currently aged between 18 to 34. These young, inexperienced civilians are more afraid to file taxes than ever. In most cases, it is simply because they do not know how or do not think they earned enough to have to file. Anyone making more than $23,100, on paper or in cash, must file taxes.MillennialsPic

Fear of Making Mistakes

Millennials are terrified of being audited and do not want to pay a tax preparer to do their taxes. Making mistakes can lead to refunds being withheld in upcoming tax years and can result in tax liens. Although this fear exists, millennials still need to file their taxes.

Not Filing Self-Employment Taxes

Millennials have more self-employment options available than other generations. Those that work at home, or independently through services like Uber, still have to file taxes. You will file quarterly so that your earnings are reported and you are still paying into Social Security.

Previous Mistakes Catch Up

If you do not file taxes for several years or make a mistake, it may take a few years to catch up to you. When it does, it is likely to come as a surprise. Each year, it is ideal to go over the previous year’s return to check for inaccuracies.

Use the assistance of a tax preparer or online tax software. Do not avoid filing your taxes. It will lead to more trouble in the years to come. If you are not able to pay taxes owed, the IRS does offer payment plans that are rather flexible.

Image credit: Elizabeth Hahn

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