Your Paycheck and Taxes

What it is

Reading a paycheck (what’s taken out and why) and the basics of filing taxes.

Why it helps you

You’ll know what you really earn, avoid scary mistakes, and claim money the government may owe you.

This opens up

Budgeting with real numbers.

Where to get help

Understand your paycheck

Your Paycheck Explained (consumer.gov) A short, plain page from the Federal Trade Commission (FTC). It explains your pay stub: what you earned, and what was taken out for taxes and benefits.

Cost: Free
Who can use it: Anyone
How to start: Read it with one of your own pay stubs next to you.
Good to know: “Gross pay” is what you earned. “Net pay” is what you take home after money is taken out.

Get your taxes done for free

VITA free tax help (IRS) IRS-trained volunteers do your taxes with you, for free. VITA (Volunteer Income Tax Assistance) sites are often in libraries and community centers.

Cost: Free
Who can use it: Mostly people with low to moderate income, people with disabilities, and people who speak limited English. Each site may set its own income limit.
How to start: Use the VITA site finder on the IRS page, or call 1-800-906-9887. Ask for an appointment.
Good to know: Bring a photo ID. Bring your Social Security card (or ITIN letter) and your W-2s (the tax forms from your jobs). Many sites are open only during tax season, about late January to mid-April.

AARP Foundation Tax-Aide Free tax help from IRS-certified volunteers, at thousands of sites. It focuses on people over 50 with low to moderate income, but helps people of all ages.

Cost: Free. You don’t need to be an AARP member.
Who can use it: Anyone who qualifies, with a focus on people over 50
How to start: Use the site locator on the page, or call 1-888-227-7669.
Good to know: Sites take appointments from early February to mid-April.

MyFreeTaxes (United Way) Free online software to file your federal and state taxes yourself. Trained helpers can answer questions. There is also an option to have your taxes prepared for you.

Cost: Free, including your state return
Who can use it: People under an income limit that is set each year. Check the site.
How to start: Go to the site and choose “File My Own Taxes.” For help, call 1-866-698-9435.
Good to know: You need your Social Security card or ITIN and your tax forms. Phone help hours change during the year.

IRS Free File Brand-name tax software you can use for free, through the IRS.

Cost: Free for your federal return. Some choices also do your state return for free. Others charge for it, so read carefully.
Who can use it: People under an income limit that is set each year. Check the page.
How to start: Always start from the IRS page and click through from there. If you go straight to a company’s own website, you may be charged.
Good to know: If this is your first time filing, the software may ask for last year’s “AGI” (adjusted gross income). The IRS says first-time filers over 16 should enter 0. The IRS’s own free filing tool, Direct File, isn’t available right now.

Protect your tax identity

Identity Protection PIN (IRS) A 6-digit number the IRS gives only to you. With it, no one else can file a tax return using your Social Security number.

Cost: Free
Who can use it: Anyone with an SSN or ITIN who can prove who they are
How to start: The fastest way is through your IRS online account. You can also apply with Form 15227 (it has an income limit), or in person at an IRS office with your ID.
Good to know: You get a new PIN every year. You’ll need it each time you file.

If someone else claimed you or used your number

Sometimes a parent keeps claiming an adult child as a “dependent” (someone they support) on their taxes. That can block your own return. Or someone may have used your Social Security number.

Know the rule. For most families, a parent can claim you as their child only if you are under 19, or a full-time student under 24, at the end of the year. Other rules apply too. The IRS says only one person can claim you in a year.
If your e-filed return is rejected, you can still file. You can mail a paper return. The IRS will sort it out by mail.
If the IRS sends a letter called CP87B, it means someone else claimed you. If you really aren’t their dependent, the IRS says you don’t need to do anything.
To stop it next year, get an IP PIN (above).
If someone used your number for credit or loans, see Credit and Debt for credit freezes and IdentityTheft.gov.

If you only do one thing first

Find your nearest VITA site and make an appointment. A trained volunteer will sit with you, ask simple questions, and file for you. If you are owed money, they will help you get it.

Watch out for

“Instant refund” or “fast cash” offers. These are often loans against your refund, with fees. Free e-filing with direct deposit is usually fast.
Preparers who won’t sign your return. Paid preparers must sign and include their ID number. Don’t sign a blank form. Don’t let anyone put their bank account on your return.
Fees based on your refund size. Avoid anyone who charges a percentage of your refund.
Fake IRS calls, texts, and emails. The IRS says it normally contacts you first by mail. It only emails or texts if you signed up for that. Scammers threaten you or demand payment right now, often in gift cards. If you’re unsure, hang up and call the IRS yourself, using the number on IRS.gov.
Tax tips from social media. “Secret” credits pushed online can get you in trouble. Ask a VITA volunteer instead.
A wrong bank number. Check your routing and account numbers twice when you ask for direct deposit.