Filing federal and state taxes is a legal requirement for taxpayers, but learning how to file correctly is important.

It can prevent you from owing hundreds, if not thousands, of dollars in interest and penalties for under reporting income or not reporting it at all.

This is a primer on how to file your taxes for the first time. Please be aware that you should ALWAYS contact a tax professional if you have questions about the process or any specific tax situation. All the information provided here is from the Internal Revenue Service, the agency responsible for federal tax collection.

First let’s define some tax terms you should know when filing taxes.

When are you required to file federal and state taxes?

The Internal Revenue Service (IRS) requires taxpayers to file a tax return each year by April 15. But state returns are filed at the same time as federal returns. Check your respective state government for state filing deadlines.

Determine Your Filing Status

The IRS defines the five filing statuses: single, married filing jointly, married filing separately, head of household, and qualifying widow(er) with dependent child.

Calculate Your Income

Review your W2 or 1099 form to ensure the dollar amounts are correct. Contact your employer if you have questions about what is on the form.

How much income requires you to file a tax return?

You can check the IRS website for information on how much income requires you to file a tax return, but here are the guidelines it uses.

If you made less than the amounts in the guidelines and federal taxes were deducted from what you received, then you may want to file a return to see if you are eligible for a refund.

Filing Your Taxes

Step 1. Gather Your Documents: Collect all the necessary documents, including your W-2 form (if you’re employed), 1099 forms (if you’re self-employed or received other income), records of any deductions or credits you plan to claim, and other relevant financial information.

Step 2. Determine Your Filing Status: The IRS defines the five filing statuses: single, married filing jointly, married filing separately, head of household, and qualifying widow(er) with dependent child.

Step 3. Choose a Filing Method: You have three options for filing your taxes:

• Tax software downloaded onto your computer.
•   Online with websites such as Turbo Tax*, FreeTaxUSa, TaxSlayer, or TaxAct. These apps guide you step-by-step to complete your federal and state taxes. Then you can electronically submit your forms to the IRS and the state.
•   Paper using the official forms from the IRS. You would complete your tax returns offline and mail them to the appropriate IRS mailing address.

Your tax return can be filed free of charge using the IRS website. You can find IRS publications here that explain the filing process. The IRS also has taxpayer clinics for low-income residents.

*TurboTax, an Intuit-owned company, has been one of the most popular options for tax filing. However, it has been sanctioned by the Federal Trade Commission for its business practices, so use it and other similar online programs with caution. Pay for only the services you need.

Step 4. Check your work: Double-check the information on your tax forms BEFORE filing.

Ensure that the personal information, like your address, phone number, and Social Security number, is correct. Ensure the amount of income you report, deductions, and other detailed information is correct. If you need clarification or have questions, consult a tax professional.

After You’re Done

Download and keep paper copies of tax returns you file with the IRS or state tax agency. The general rule is to keep those tax returns for a minimum of three years. Keep W-2 and 1099 forms, plus any related documents, for at least 10 years. You are always subject to an audit of your tax filings. An audit is a detailed government review of the information you have provided. Urban Money suggests you keep all your tax documents indefinitely. No statute of limitations exists when government tax agencies can launch an audit.

Reference: Internal Revenue Service www.irs.gov