How to pay taxes in the USA

Taxes are amounts of money people contribute to the costs of running a country or community. For example, taxes pay for schools, hospitals, and roads. When immigrants and citizens pay taxes, they are paying their share of programs that benefit them.

Here you will find information on what is a tax, what is income tax, how to file a tax return, if you need to file a tax return, what to do if you do not have a social security number, if you are undocumented, Afghan parolee options, help to file and pay taxes, what is the recovery rebate credit, the 2021 child tax credit, and how to file your tax return online. 

A woman with tax forms in front of her face

What is a tax?

A tax is an amount of money we pay to governments. Governments include federal, state, and the smaller, local governments that run counties and cities. If you earn money, spend money, or own property in America, you will pay taxes of one kind or another. It is important to understand how to pay taxes the right way.

What is income tax?

Income tax is a tax on your income (what you earn or receive every year). People pay income tax to the federal government and to most state governments. Some states, such as Washington and Florida, do not charge income tax.

Federal income tax is collected by the Internal Revenue Service (IRS) and goes to the US Treasury. State income tax goes to state revenue departments.

The rate, or amount, of income tax you pay, depends on how much you earn and what your expenses are.

Other things affect how much you pay. If you have children, you get a tax credit to help you with the costs of raising a family. A tax credit means you pay tax on less of your income.

Getting married can affect how much tax you pay, too. Single people get a lower tax credit than a married couple, so they may pay more tax. But married couples who both work may pay more tax together than when they were single.

How do I file a tax return?

Every year, workers and businesses have to calculate their income for the year before. They figure out how much tax they owe and send that amount to the government. This process is called “filing a tax return.”

Many people have already paid their taxes in full by the time they file their tax returns. This is because an amount for taxes is taken out of their regular paychecks before they get paid. Sometimes, your tax return may show you’ve already paid too much tax, and the government owes you a refund!

Important note: You must tell the truth on your tax return. This is particularly important if you are not a US citizen because false information on your tax returns can get you deported. If you are a legal permanent resident (green card holder), make sure you declare all your income. Read the USCIS information about taxation of resident aliens.

Do I need to file a tax return?

Whether you owe taxes or the government owes you, it is your responsibility to know when and how to pay taxes.

If you filled out tax forms when you started your job, you will receive a W-2 form from your employer at the beginning of the year. The W-2 shows how much money you earned and how much money you paid in taxes. You will need this form in order to complete your tax return.

You must send your tax return for the previous year to the government before April 15 every year. You need to file your taxes with the IRS on a government form.

What if I do not have a social security number?

If you earn income in the United States, the law says you should pay taxes. You can pay taxes without a social security number.

You can use an Individual Taxpayer Identification Number (ITIN). The Internal Revenue Service will give you an ITIN if you are not eligible for a social security number (SSN).

Find out how to apply for or renew an ITIN in English or apply for or renew an ITIN in Spanish.

What if I am undocumented?

If you earn income in the United States, the law says you should pay taxes even if you are not a legal resident. You use an ITIN to pay taxes.

Paying taxes when you are undocumented can help to show you have “good moral character.” Good moral character is important if you apply for a cancellation of removal, a green card, or another immigration program in the future. 

USAHello advises that you talk to an immigration professional before you apply for an ITIN. You can find affordable legal services in your area.

What if I am an Afghan parolee?

Learn if you are eligible for the COVID-19 stimulus package, including information in Dari and Pashto at the bottom of the document.

How do I get help filing and paying taxes?

If you are having a hard time understanding how to pay taxes, do not worry. You can get help. Many community organizations offer assistance.

The government has a program to help people who need it. The Volunteer Income Tax Assistance (VITA) program offers free tax help. VITA helps people who earn $54,000 a year or less, to people with disabilities, and to people with limited English.

You can find the nearest help by using the VITA locator. Many places offer help in Spanish, Arabic, Chinese and other languages.

What is the Recovery Rebate Credit?

This is a credit you can claim on your 2021 federal tax return if you did not receive your third economic impact payment. This was the third round of payments provided by the government to help people during the coronavirus pandemic.

The third Economic Impact Payment amount was:

  • $1,400 for an eligible individual with a valid Social Security number.
    • $2,800 for married couples filing a joint return if both spouses have a valid Social Security number or if one spouse has a valid Social Security number.
  • $1,400 for each qualifying dependent with a valid Social Security number or Adoption Taxpayer Identification Number issued by the IRS.

If you received these amounts in direct payment, you do not need to complete any information on your 2021 tax return. If you did not receive payment or only partial payment, you can file for the Recovery Rebate Credit on your 2021 income tax.

2021 Child Tax Credit and Advance Child Tax Credit Payments 

The child tax credit is a credit you get when you file your income tax return. This is for children from 0 to 17 years of age. For 2021, it provides $3,600 for each child under 6 years old and $3,000 for each child between 6 and 17 years old. 

In 2021, the U.S. government provided an advanced child tax credit to families. From July to December 2021, you would have received half of the tax child credit you are eligible for automatically. The other half will be applied to your 2021 income tax. 

Learn more about the advance child tax credit payments.

Filing your tax return online

If you prefer to file your own tax return, there are several programs you can use, including the most common one, Turbo Tax. But you do have to pay for Turbo Tax.

You can also go straight to the IRS Freefile website and start the process there.

The information on this page comes from the US government, the Internal Revenue Service (IRS), and other trusted sources. It is intended for guidance and is updated as often as possible. USAHello does not give legal advice, nor are any of our materials intended to be taken as legal advice. If you are looking for a free or low-cost lawyer or legal help, we can help you find free and low-cost legal services.