Some Questions That Need Answered- Some Stuff Abut Adulthood

Question

Hey there-

I'm 14 years old, and I wanna know how to do some stuff that's never been brought up at home, like how to file taxes(what is necessary to do so, documents needed, etc.) And how to balance a checking account, which I've already worked on a bit at school. We worked on filling out tax forms based on circumstances of made up people, but I know it's probably not as simple as the teacher made it sound, not as easy as one form.

Help is appreciated.

Bella

Answer 1

I am Canadian so I only know how it works here...

Around Feb or March your employer will send you a form which states income made for the year you are filing taxes for, the taxes paid on that amount and any other amount paid into.  Like unemployment insurance, pension funds etc.

If that is all the income you have that is all you need to file.  I use a computer program which asks a questionaire and takes you through your tax filing step by step.  Then when I put in all the information I file it online.  If I paid too much tax throughout the year I get some of that back in a government cheque in a few weeks along with my tax return assessment.

If you didn't pay enough taxes then you will owe the government money.  This happens sometimes to people who work many different jobs or who own their own business.

Other things you can claim are any student loan payments or tuition paid in that year.  You can also claim medical costs dependants and any unemployment insurance money you received.

As for balancing a chequebook... I have never done that... I do my banking online and only write cheques to pay the rent.

Answer 2

okay.. your a little young to be worried about taxes and check books.

Heres what I would do.  

Taxes:  Wait until you get a job.  Then ask your parents what you need to do w/ the W2 thingy.  Its pretty simple.  You take the W2 [ a form given to you by your employer] to a tax place and they do it for you... Taxes only get more complicated when you actually start owning things like a house, a boat, a car, have actual savings, etc

Checking:  Do you have a checkings account?  If not its really not important now.  I just recently got mine though and its something you can easily catch on to.. Especially with online banking becoming readly available.

Answer 3

HowStuffWorks.com is a great site.  You can get a lot of good information on these kinds of things there.  For example, I just searched the term "how to file taxes" from their main site and this was one of the results:

http://money.howstuffworks.com/personal-...

Answer 4

It is not too early to get a handle on finances. Ever hear of "Biz Kids"? Schools should spend more time on the basic functions of money management such as how to pick a credit card; what does a loan really cost, and what are the best savings programs.

I suggest you join a credit union and get an account in your name. You will have to have a parent on the account, too, but it should be for your money.

Why?  Many credit unions have classes on how to balance a checkbook and other financial related classes. Usually free, too.

Some require a certain affiliation but you may have that through a family member. Otherwise, look for a community credit union in your area.

Tax forms are relatively simple until you get into stock sales and have losses to claim. You parents probably fill out a 1040 form - there are multiple types with the same number but they have suffixes like "A" or "EZ". The booklet the form comes in has step by step instructions to help you determine deductions. The average person just needs to keep good records for the year and then it takes an hour to fill the forms out. If you have a more complicated return with rental properties, etc., then a professional is the way to go.

Answer 5

Go to the library, or go to the www.irs.gov

There is plenty of literature about it.  You may want to study some basic accounting as well.  Sounds like you are interested in money, so look into taking some classes...even at your own expense.

In terms of the checking account, just google "how to balance a checkbook"  and I'm sure you can find a tutorial out there.

Answer 6

your 14 CHILL

getting old blows (taxes really suck_)

Answer 7

Actually, yes, it is just about that easy to fill out a tax form.  When you first get into the working world, it's most likely that your only source of income will be from a job.

The tax form for that is so easy, there's only a few figures to fill in.

It only gets more complicated if you start buying and selling stock, own your own business or corporation, etc.

Answer 8

just pay your bills and collect your income

Answer 9

Sounds like your school is doing a good job of giving you life info.

Filing taxes can be very simple, or very complicated, depending on your situation - for many people, it IS simple and is just one form.

Answer 10

Right now all you can do is practice with the simulations given to you in school.  When you get to highs chool you can take beginning accounting and business math classes that will also help you prepare for the "real world".

It is too bad your parents do not involve you in the business of running a household.  When I was in middle school or younger my mom would have my sister and me help pay bills.  We would see the electric and phone bills, write in the amounts due and give the checks to our mom to sign.  That way we KNEW that living in the home she provided wasn't free.  We also did grocery shopping when we were older.  We were given a list and a specificed amount of cash.  We had to be careful to not buy extra (junk), we had to show her the receipt and give her the change.

Ask your father or mother to involve you.  Seeing how the business of your family is run will be much better than the school simulations.  

Answer 11

Tax forms usually show up in a booklet in January.  The instructions are fairly idiot proof.  its knowing what the booklet is talking about and whether options apply to you or not that is tough.  

When you get a job you will likely file a 1040EZ.  These are for people who have no reason to take anything other than the standardized deduction which is a few grand.  There is also a 1040A and 1040 but these have other deductions like Earned Income Credit (EIC) and education credits like the Lifetime Learning Credit (which you need another form but you won't need to think about this until college).  Really, taxes aren't as tough as they seem.  It's intimidating but the easiest way to circumvent that is to read, use the IRS website and ask questions.  (After you start driving, you can actually deduct the costs of fuel and insurance because you use it as transportation for school!)

As for balancing a checkbook, that is more like a running tally of algebra equations.  One column is deductions, another is additions and the last column should be the current balance.

Answer 12

one of the best ways to learn about income tax is to go to the IRS web sire, IRS.gov and look around.  In the forms and publications section you will find most forms used and their instructions.  Have fun but don't get too serious about it.  

Answer 13

Hey, Awesome question for a 14 year old.  It's great that you want to learn these things and do it right the first time instead of making tons of mistakes and then trying to learn.  I agree with other posters though that if you don't have a checking account don't worry about it, we could tell you how to do it but you'd forget if you don't do it for a few more years.  

Actually taxes can be as easy as one form.  If you only have regular income from a job and make less than 50k you can file the 1040EZ for your federal income taxes and its fairly simple and you could do it by hand.  Tax software such as Quicken's Turbo Tax and H & R Block's software is fairly easy to do, just answer the prompts.

Definatly revisit these topics when you have a job and a checking account.

Answer 14

Look for this book at bookstores or in a library:  "Personal Finance For Dummies."  It'a an easy-to-read great starter book that touches all bases.