Washington Week: Student Voices (O)

Southern Illinois U. students prepare for tax season
By Jordan Wilson
Daily Egyptian (Southern Illinois U.)
03/02/2006

(U-WIRE) CARBONDALE, Ill. — Filing taxes is never going to be the cool thing to do.

Before the Internet generation, most college students who filled out those tedious tax forms had few resources aside from books, word of mouth and the Internal Revenue Service itself.

With the April 17 federal tax deadline in view, students don't need to fret. A hefty load of online information, coupled with the ever-growing world of electronic filing, can make the process of filing taxes as pain-free as opening that refund check envelope.

Julie Smallheer, a Southern Illinois University junior studying broadcasting, said she wouldn't mind a little convenience during tax season. She said she thinks taking her W2 forms to a tax preparer is a rip-off, considering it is free to do online. She said this year she would give the IRS' online e-file a try.

"I might start doing it that way," Smallheer said. "I'm not trying to sound mean, but if my mom can figure it out, I think I can."

Smallheer isn't alone in the trend of people shifting toward electronic filing.

Michael Devine, an IRS spokesman, said filing taxes electronically has already started to phase out the longhand paper version. He said the 2004 tax season was the first time that more than half of the country's total returns were filed electronically. Through a number of free services offered on the IRS' Web site, Devine said it's easy for taxpayers to find a fast and safe way to bury the tax burden.

"You can use the e-file and the direct deposit," Devine said. 'You can have your refund in as little as two weeks. That's not a bad deal."

Of course, it's not always that easy for tax filers. The traditional tax deadline of April 15 — which was moved back because the other date falls on a Saturday — has become a type of doomsday for those having to cut a check to Uncle Sam.

If the amount is too much or if you don't have time to gather all the necessary forms, Devine said an extension is possible. Prior to this tax season, approved extension granted a taxpayer four months of amnesty. This year, that grace period has been expanded to six months. But just because an extension is granted doesn't mean money owed to the IRS goes unaccounted for. Devine said that amount still has to be paid, but a payment plan can be set up if a lump sum isn't possible.

Luckily for the college-aged crowd, it usually doesn't have to pay the IRS hundreds of dollars. Brenda Watts, the office manager at the Carbondale, Ill., H & R Block, said students generally are the ones receiving the checks as a result of tax returns, not writing them to the government. Watts said assuming a student has no exemptions, is single, doesn't have a six-figure salary and doesn't own property, it's safe to say he or she will have a refund on the way.

If a person provides bank account information while filing his or her taxes, a direct deposit option would be used for a refund. In this case, a refund could arrive within two weeks.

Watts said confirmation from the IRS within two days of filing taxes online and a quick refund make online filing the ideal route to travel.

"Electronic filing is the way to go," Watts said. "It's a win-win situation."

CAUTION IS THE KEY

To avoid scratching your head, wondering where your federal tax refund is or dodging collection letters from the IRS, simple steps of precaution should be taken.

Communication between parents and students is one of the most important steps in the tax-filing process. Most of the time, Watts said, it goes unnoticed.

"There's not a lot of communication between college students and parents," Watts said. "We've been down that road a time or three, that's for sure."

Dan Kerley, the vice president of operations at Jackson Hewitt Tax Service in Carbondale, said if students don't interact with parents, it could spell disaster. He said most of the time, students will claim themselves to be independents. Problem is, the parents would claim them, too.

"We have issues where college students claim themselves before their parents can claim them," Kerley said. "It creates a mess, because then the parents' forms get rejected."

To avoid issues like this or any problems that may surface while using a tax-preparing agency, Devine said it's important to find a trustworthy company. He said to make sure the agency will still be in business in the future. That way, if you have any discrepancies, you will have someone to go to. Or in other words, a reputable tax agency is usually a safe bet.

"Pick your tax preparer like you would pick your attorney or dentist," Devine said. "When you get dental work done, you'd like your dentist to still be there in two or three months in case the filling comes out. Whoever does your taxes should know what they're doing. If there's a problem in six months, you want them there to answer questions."

PROCRASTINATING NOT SMART

Holly Martin said taxes aren't exactly a priority in her household.

Martin, an undecided freshman, said taxes are sometimes put off until the last minute. She said when her family turns their tax forms into a tax preparer, anticipation sets in.

"We take them somewhere and the lady is always late doing them," Martin said. "My parents get worried about that."

Devine said this probably isn't the best approach. If any problems come up or a form is missing, procrastination can in turn prove to be detrimental to the tax process.

"Don't wait that long," Devine said. "It's not like finals week where you can cram at the end. Start early and get it done."

Even though someone's refund may be too small to even care about, it is required by federal law to file taxes. Beside that, there is an enormous amount of money going unclaimed. After three years, Devine said that money goes to the federal government.

"For people that didn't file their taxes in 2002, there's about two billion dollars sitting there in unclaimed refunds," Devine said. "Billion — with a 'B.' That's a lot of zeros."

Even if someone isn't guaranteed a sizeable return this tax season, a tax form is the key that opens the door to federal financial aid. So no matter someone's situation or preference toward filing taxes, it is, after all, inevitable.

"One thing we see a lot in Carbondale is it gets close to time to fill out financial aid forms and, 'Uh-oh, didn't do taxes,'" Watt said. "You have to have those numbers for student loans. Don't put it off, just bite the bullet and do it."

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