This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Tax-time Strategies for 20- and 30-Somethings

By Hal M. Bundrick

Remember your first paycheck? How surprised you were at all the taxes that came out of your pay? And then, when you had to start filing taxes, somehow you got a refund! What the what? Money back? You started looking forward to filing your taxes, didn't you? You did the little "I'm gonna get a tax refund check" dance, didn't you? And then you made more money, kept filing the short form, and within a few refund. In fact, you owed money to the IRS!

Welcome to the Other Side.

Just like the rest of us, Millennials worry about taxes.

"The thing that I am most worried about when it comes to taxes is how much more I going to have to pay each year," says Elizabeth Samolis, a student in Maryland and graphic artist for 20Something Magazine. "I have always paid my taxes and on time, but my taxes just keep going up. And for what? As my taxes continue to rise, we hear more and more about billion dollar corporations paying zero taxes and getting a refund. What is fair about that?"

Oliver Gray is another Gen-Yer who worries about taxes.

"From personal experience, a lot of my friends seem really concerned about filing incorrectly and getting in trouble -- or even audited," says Gray, 27, a contract employee working with the U.S. Treasury. "Taxes seem pretty overwhelming before you get acclimatized to all the little boxes on all those forms, and I think a lot of young people quit before they begin. They just throw some money at TurboTax or H&R Block and hope the problem fixes itself."

The good news: most Gen Y filers don't have to worry about math mistakes or getting audited by the IRS. Maybe your parents have to sweat the possibility of an IRS call, but you - not so much.

"The IRS routinely sends out notices for math corrections and omitted items," says Tim Abbott, a CPA in Lombard, Illinois. "This is much more common than people realize, and it rarely triggers an audit. The biggest factor in being selected for examination by far is still a taxpayer's adjusted gross income. Those earning more than $200,000 a year have a substantially higher chance of being audited than those earning $1 to $200,000."

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,356.87 +288.00 1.69%
S&P 500 2,012.89 +40.15 2.04%
NASDAQ 4,644.3120 +96.4780 2.12%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs