the staff of the Ridgewood blog
Ridgewood NJ, A huge part of growing up is doing your own taxes. In fact, some people consider it to be the toughest part of becoming an independent individual. Not only are most of us bad at math, but also, where do we start? How do taxes work? What do you get taxed for? How much should you pay? All of these are questions that often face every single person as they are starting out their own lives. These are also questions that people tend to ask whenever they move into a different state; it can be exceptionally confusing because of the difference between what you were used to in your previous state and your current situation. However, there is no need to stress about it because of two reasons; stress isn’t healthy for you at all, and also because this guide is going to show you how to take care of your taxes if you happen to be living in the wonderful New Jersey.
When we look at taxes from afar, it’s easy to get terrified because, from that point of view, taxes tend to appear like a huge monster. Meanwhile, when we break down the filing process into simple steps, you will get to understand that filing taxes is more like a tiny bunny than they are a tyrannosaurus rex.
- Step 1: Determine your residency status
How long have you lived in New Jersey for? If you happen to be staying in the state i.e. not on a business trip, a holiday, or other temporary affair, and have spent over a month there, then you need to file for an NJ-1040. On the other hand, if haven’t spent that much there, you should file for an NJ-1040NR.
The type of form you should file for also depends on whether or not you have a permanent home in New Jersey; whether it is rented or owned doesn’t matter. If you don’t have a home in the state, yet you receive income from New Jersey, you should file for an NJ-1040NR.
- Step 2: Determine your income status
You may have heard about the 1040ez, and if you are like most people, there is a huge chance you’re asking or wondering why might you complete a 1040 instead of a 1040ez? Read here.
This point will be tackling your income status from a more basic aspect. In order to file for an NJ-1040 or an NJ-1040NR, you need to be receiving income from New Jersey. If you don’t, then you may need a different form.
After determining whether or not your income is taxed by the state of New Jersey, you need to calculate your gross yearly income. If you happen to make a gross amount of over $10,000 a year, you need to file for tax returns.
- Step 3: Fill out your form
To be extra sure, before you fill out your form, you need to check out the state of New Jersey Division of Taxation’s official website, and go over the first two steps mentioned above. The website has more detailed information on the terms of eligibility for income tax return forms.
After everything is cleared out, it is time for you to start filling out the form. First of all, make sure you only use blue or black ink, as well as, refrain from using dollar signs. Then, make sure you keep to the instructions.
You need to enter each piece of information as accurately as possible, and in its designated field, too. While going through the form, you may need the help of an accountant to help you identify your gross income, and your losses. Then it is up to you to report all income you earn, that happens to be deemed taxable by the state of New Jersey.
This is pretty much the hardest part. After you state your income from every taxable source, all what you need to do is just follow along with the instructions provided in the form. It’s as easy as that.
Now, taking all of the above into consideration, there is no doubt that what you once dreaded has lost its power. After all, doing your taxes is not that hard of a process. As long as you follow the instructions provided, and provide accurate information, your paperwork is going to go smoothly. Plus, if in doubt, just visit the New Jersey state website; it has detailed information on every single tax form, and every single line within those forms. Good Luck!
It’s a guide for HS kids, right? Trying this as a married adult with a home, brokerage accounts, a job in NYC, charitable donations, etc. is not a good idea.
How about not doing it for 5 years.
Unless you are an accountant familiar with the ever changing rules yo u have to be fool to attempts this without retaining a professional. You hire people to cut your grass, clean your house, walk your dog, and put up your Christmas lights. Why risk an audit ? And if you Get picked for an audit the professional who signed your return can go speak with the IRS. What’s the cost of a personal return prep?$300-600?
Turbo Tax (or one of the variants). It’s cheap and accurate. You only need to pay for a CPA if you really have some complicated issues, such as running a business, divorce, etc.