[00:00:00] - Intro music
Kayla: Hello, and welcome back to Routine Drama. I am Kayla and we have made it to episode four. So obviously, not a ton of episodes here right now, still very, very early days. But you know, I think we have to celebrate the small wins. So I am glad to be here doing another episode [00:00:30] for whoever is watching at this point.
[00:00:32] The Stress of Tax Season
Kayla: For today's topic, just because of the time of year that it is and because I'm already seeing so much discussion about this online, I thought it would be a good idea to do an episode on filing your taxes, because I feel like that is just one of the most routine and dramatic—and by dramatic, I mean, stressful, annoying, and [00:01:00] kind of just generally mentally distracting—aspects of every year.
[00:01:05] Introduction and Welcome
Kayla: I don't think any of us really like filing taxes.
I think most of us find it quite stressful, but I think there are some things that we can do to make it a little bit less stressful and maybe not spend a ton of our mental energy and time at the time of year, every year when this inevitably comes around.
[00:01:28] Understanding Tax Deadlines
Kayla: So if you don't already know, in the [00:01:30] US your taxes are due on April 15th. And so that is for the 2023 year. Your taxes are due April 15th, 2024.
Which, let me look it up, that is a Monday this year. So Monday, April 15th, 2024. If you're in the U S. Your taxes are due that day. So make sure you have them filed by that date.
I'm already seeing a ton of people talking about wanting to find a better way to do taxes, [00:02:00] looking for recommendations for a tax preparation software online, and I know all our tax forms are already being sent out by our employers. I've certainly gotten mine. So I just wanted to kind of go through
[00:02:17] Why Taxes are Stressful
Kayla: why taxes are so stressful for many of us every year and maybe what we can do to eliminate some of that stress so we can just get on with the rest of our lives.
So why are taxes so [00:02:30] stressful?
For so many of us, I think a large part of it is because the government doesn't really tell you how to do your taxes correctly. I mean, yes, they let us know, okay, you need to have them file by this date.
I think generally everyone knows your taxes should include all the places you've worked in the last year. But other than that, I mean, how many of us are just [00:03:00] estimating how much tax we're going to either owe or potentially get back each year? I think all of us, because the government doesn't really tell you, like, hey, we know you owe this amount. Please pay us that.
It's always kind of like, to me at least, feels like a guessing game. And you know I'm not a financial expert, so maybe that makes sense, but I don't think most people are financial experts so [00:03:30] anything that we can do to take a little bit of the guesswork out, I think is helpful.
And I don't know. I don't know about you guys, but I have this kind of irrational fear of being audited. I don't even know why, like I don't even make enough money to make it worth the government's time to audit me.
And I don't do anything shady with my money so I'm not sure why that is a thing, but it's always something that I guess I just don't—I would [00:04:00] not want to deal with the stress of being audited and having to fill out more paperwork and deal with God knows what else comes with that.
So I'm always worried that I'm somehow going to mess up my taxes in a way that is going to like irreparably damage my financial situation and life, and just cause all kinds of hassles for me. So for me, at least, that's definitely a reason that tax season is stressful.
A couple of the other reasons [00:04:30] I think it's stressful is, again, I don't feel like any of us ever really know if we're going to owe money to the government or if we might get a little bit back.
I personally withhold a little bit extra money from my paychecks, every paycheck, so that there's a better chance I'm not going to owe any money. But I still don't ever really feel like, oh, okay, like, I'm good until I [00:05:00] get my taxes done and like, see if I'm going to get a return or if I'm going to owe money.
So right now, I think I only hold back, I want to say it's even maybe just like an extra hundred dollars a paycheck, which I know is not possible for everyone, right. That you can't just hold an extra a hundred dollars from each paycheck you get.
A lot of people need that money urgently. So I am very grateful and fortunate that I am able to do that. [00:05:30] But even just holding that back, I was able to get a small return this year.
Based on my understanding and what some financial consultants have told me, you don't want to hold too much extra money back and get a bigger return at the end of the year, because then that's less money that you could be spending or, you know, putting into other things in your life throughout the year.
So you want to kind of find the balance, I guess, of how much do you hold back so you don't owe money, but so you [00:06:00] still have a relatively flexible working income throughout the year. Again, if that is an option for you. I completely realize it isn't for everybody.
For a lot of my life until maybe the past. Two years even, and I'm 32, so until I hit about 30, it was not possible for me to withhold extra money from my taxes throughout the year. And I would end up owing the government money, sometimes a couple thousand dollars [00:06:30] every year.
And it just, there really wasn't a lot I could do about it. Or, or maybe it's more accurate to say there wasn't a lot I was willing to do about it. Because I felt like, you know, I worked so hard and, you know, put so much effort into just getting by most of the year that yeah if I wanted to spend like a hundred dollars going out to a bar or going out to dinner with friends or whatever [00:07:00] throughout the month, like, yeah, let me do that. Because I need some kind of fun time and balance amidst just working all the time.
And I feel like a lot of people feel that way, but again, you know, it's so hard when you are in those situations where you're living from paycheck to paycheck and every single cent of that paycheck is going towards just existing basically. But if you are able to set some money [00:07:30] aside, then try to withhold a little bit extra throughout the year to make it a little bit less stressful in wondering like, am I going to owe money to the government?
[00:07:39] Tips to Reduce Tax Stress
Kayla: If you hold a little bit aside, you increase the chances that you won't owe money. Maybe you'll get some back, but at the very least you shouldn't get slapped with like, you know, a couple of thousand dollars, which I have in the past. It's not fun.
And another thing that I think adds to the stress—and maybe this is because we're kind of stressed out about filing [00:08:00] taxes in the first place—is that, I know I have in the past, I know many people now who put off filing their taxes until like the very last second.
I know people who will file the day before. Which for me, I cannot think of a more stressful way to go about doing it.
But I mean that, I think some of that pressure makes us want to not deal with it. And then we procrastinate and then before you know it, it’s April 13th, 14th, and you're [00:08:30] like, I gotta get this done.
I think by just doing your taxes early, knocking them out, as soon as you're able to that just lifts that pressure. You get some of those questions answered faster in terms of like, are you going to have any money coming back? Are you gonna have to pay money? And you can just deal with all those things a little bit sooner, which is my preference, because then I can just move on with my life, right? So yeah, definitely file early if you can.
And just for me, as soon as I get [00:09:00] my tax forms from my employer. I will go ahead and file just to have it out of the way so I can not worry about it anymore.
It looks like we have some sun coming out. Go figure. Yes, I also do not have a ring light or anything like that yet. We are working with natural lighting only right now. And it is changing. So bear with me. I might have to adjust these blinds. I think.
Okay. So, yeah. File early. And I think another way that you can [00:09:30] just eliminate a little bit of extra stress is to try to keep each year's filings organized in some way so that they're easy to find.
If you do have paper filings or paper documentation from your e-filings, make sure that you are keeping those in a place where you'll be able to find them again. I try to just keep a folder in like one location that I never move it from. And all of my tax paperwork goes in there so I can easily find it [00:10:00] next year.
Or since I have moved to the solution that I'll discuss in a minute, I just keep a folder or like a label in my email inbox. And anything related to my taxes goes in there so that I can easily find it the next year. And it's just one less thing that you have to think about.
Like, oh God, I’ve got to take that out of the closet. Like I’ve got to try to find that in my inbox, and kind of just removes an extra barrier to filing your [00:10:30] taxes early and getting it over with.
[00:10:31] The Benefits of Hiring a Tax Professional
Kayla: And last but not least, I think that for me, probably the biggest contributor to not being stressed out about filing my taxes is that I have just hired someone to do it for the last couple of years.
Again, I know that feels like it's not an option for a lot of people, but based on my experience—and my experience only—I have found that it's really not much cheaper [00:11:00] to self-file, depending on how much income you make, what you're bringing home.
It really, for me at least, didn't really save me any money to go through a company to have someone prepare my taxes for me, versus going through the whole process of doing them myself.
I have used, you know, self-filing software in the past, like very popular ones. It's not that the software is that complicated, it's just that. [00:11:30] I am not an expert in taxes and so I just get very stressed out because I feel like I don't really understand the significance of what I'm entering.
And like, yeah, you can go through the instructions that they're giving you and like fill out everything to the best of your abilities, but, you know, at the end of the day, I still ended up paying… it was definitely over a hundred dollars. And if I remember correctly closer to $150 to be able to file my [00:12:00] federal, state, and local taxes.
And when I hired someone to do them for me the last couple of years, it wasn't much more expensive than that. And I didn't have to do any of the work. I didn't even have to go anywhere. I just used the company's online portal.
I liked the tax preparer I was assigned last year so I used the same person again, and it was great. Like he did it all remotely. We communicated via the messaging system in that platform. And he [00:12:30] had it done in a couple hours. So, so easy, like there's nothing that needs to be stressful about that.
In the past I would spend, you know, at least an hour, but it felt like many more just going through the self-filing software and filing my taxes and it was just so stressful.
And again, it just feels like the implications of fucking that up in any way are going to be so bad. Like in reality, again, I don't make that much [00:13:00] money, so I don't really think the IRS would care, but it's not really something I want to risk. Like, I don't want that extra paperwork and drama and hassle. So for me, it's just absolutely worth it to hire someone to do my taxes for me.
I do know that the IRS does offer free filing options or they recommend certain services that will provide free filing if you are within a certain threshold or meet certain criteria. I will drop that link in the [00:13:30] show notes and in the YouTube video description just so anyone who might be interested in free filing can check that out.
I don't in any way benefit from providing that, it's not sponsored or anything like that, obviously, it's the government. It's just a resource that might be good to check out.
The tricky thing is like, I know other commercial self-filing software, they often advertise like, oh, file for free. You don't pay anything for, state and local, but then you might pay for federal. And it [00:14:00] just kind of seems like misleading marketing.
That was how I ended up finding that I had to pay at least a hundred dollars to file before. Because I had picked that software because I wanted to file for free. And I was like, you know it's worth the time and the stress to not have to pay that extra a hundred whatever dollars if I can avoid it. So I'll just do it myself and it'll be fine.
But then of course you go through the whole stressful [00:14:30] process of entering all your information and at the end, you're kind of slapped with like, oh great. You don't meet the free filing qualifications, but we can still submit this and all the work you've done, you just have to pay us.
And then, of course, you're probably like, well, I don't want to go through doing all that again. So I'll just pay you. And it's really frustrating.
So, as we go through the next couple weeks, months, everyone who is feeling stressed about filing your taxes? I promise you're not alone. [00:15:00] I've seen comments from people everywhere as well as my own friend group. Nobody wants to deal with it.
[00:15:06] Conclusion and Contact Information
Kayla: As I've said, I am not a finance expert, tax expert. The thoughts and tips provided in this episode are from my personal experiences only.
So if you are a finance expert or a tax preparer and accountant and you have some other thoughts, advice, tips that you think people who are concerned about filing their taxes should [00:15:30] know, leave a comment in the YouTube video. Leave a comment on any of the social media posts related to this episode.
You can find the show on most social media platforms at @routinedramapod and you can email me routinedramapod@gmail.com and let me know if there's a correction I need to provide, or just share thoughts about the episode.
I'm always happy to hear about ideas for improvements, or things that you [00:16:00] liked. That would be nice too.
So, thank you guys so much for tuning in, and I will see you in the next episode. Bye.
[00:16:07] Outro music