Feeling anxious about doing your taxes? What tax pros and financial therapists say will help.
By Sarah Hunter Simanson
February 1, 2024
Tom O’Saben has seen plenty of angst from clients in his more than 30 years as a tax practitioner. “They’re holding their breath as to the outcome,” O’Saben, the director of tax content and government relations for the National Association of Tax Professionals, tells Yahoo Life. “They don’t know whether or not they are going to owe [money] or if they are going to get money back or, if they are going to get money back, how much they are going to get.” People are also worried about making mistakes, because they are afraid of the IRS.
Part of this uncertainty stems from how complicated the U.S. tax system is and that it can change every year. “Tax code can be very, very confusing, and I think that is the entryway into people feeling stressed out about what will happen with their taxes and around tax season,” Aja Evans, a financial therapist and licensed mental health counselor, tells Yahoo Life.
Because it’s so complicated, the average taxpayer spends 13 hours preparing a tax return and $240 on tax preparation services. For some, the sheer amount of effort required and expense involved create anxiety, which can make people procrastinate. O’Saben cautions against putting off your taxes.
“The number one reason why people have tax season stress is because they aren’t prepared,” he says. “They also, unfortunately, go through the year rather blindly and don’t pay attention to their withholding or lack of withholding [tax].”
Part of being prepared is knowing where to start and how to handle the fear you may feel as a taxpayer. Below are some financial and therapeutic tips to ease the anxiety of tax season.
Stay organized throughout the year. Have a designated place for documents, such as pay stubs and receipts for potentially deductible items. If you are an independent contractor or find it difficult to keep up with your finances, it might be worth hiring a bookkeeper or accountant. “If you can’t afford a bookkeeper, use Mint or an app for keeping track of your expenses,” Rick Kahler, a certified financial planner and certified financial therapist who co-founded the Financial Therapy Association, tells Yahoo Life.
“Don’t wait for tax season to understand what’s going on with your W-2s,” Evans adds. People should double-check to make sure they are withholding enough money each paycheck.
Kahler also encourages people to reach out to experts to verify what they are withholding and not rely solely on their HR department to make this calculation, because every individual’s tax situation is different. Typically, he knows that this can mean using a CPA, “but not everyone needs a CPA, and if a person is employed and doesn’t have a lot of sources of income, [you can] spend $100 or $150 to go to an accounting service and say that I just want to really double-verify that what I’m withholding is enough.” If you’re self-employed, freelancing or working as an independent contractor, it’s even more important to anticipate your tax liability during the year correctly to avoid an unpleasant surprise.