Would you like to make an extra $100 to $500 per month?
I’ll give you an idea of what I did back in college. But first-
I have two questions for you:
Do you have any legitimate tax knowledge? & Have you ever filed your own taxes before?
If you answered Yes to either of these questions, then you have the knowledge you’ll need to make some extra money.
What Is A Tax Pundit?
You should know that a Tax Pundit isn’t a real title.
And the reason I’m telling you this is because by law, all Tax Preparers must have a PTIN.
But if you aren’t going to file for a PTIN –
You can still prepare a tax return for a client to sign and file. But you can’t sign and file for them.
This essentially means that you can fill in all the spaces for their tax return. But when its time for signatures and filing, that’s entirely on them.
And you can’t charge them for preparing their tax return.
Why A Tax Hustle Is A Good Side-Hustle
You can make an easy $30+ for about a half hour of work.
I think this is also a fantastic side hustle for college students.
Especially since you’re surrounded by a bunch of other young adults who don’t know anything about taxes.
What You Need
You don’t need much to start a Tax Pundit/Preparer side hustle. All you really need is:
- Internet Connection
As for your client, here’s a PDF of what to ask them for.
Before you try doing someone else’s taxes, I highly recommend you know how to file your own taxes first.
You can decide whether you want to purchase tax preparation software or use the free online software.
I personally use free online software.
NOTE: There’s an income cap for use of free online software.
How You Can Tell You’re Ready To Hustle
You’ve successfully filed your taxes using software right? Good. You know how to use the software.
And for those of you who haven’t tried yet – it’s incredibly straightforward.
For each line you need to fill out on the software, there is a number indicating which box on your form to get it from.
It’s pretty easy.
And if you mess up, all that happens is that the IRS will deny the return and you’ll be able to re-edit it on your software.
Or if there’s anything questionable, the IRS will eventually ask for proof to validate what was given to them.
Here’s What You Do
There’s someone who wants you to help them with their taxes?
Great. Start by telling them this –
‘I’m going to make an account for you so you can get your taxes filed. What’s your email?’
Then you can send this PDF to their email.
When you get their information you can get started.
In the beginning there will be several typical questions. These are fairly easy to knock out of the park.
Not to mention that online software does a good job knowing what’s what based on the information you give it.
Then you will upload or manually insert:
- W-2 information
- 1098-T (if they go to school)
- 1095-A, B, or C (health insurance forms)
Those are the most common scenarios you will encounter.
Simply type the W-2 information from the form to the software. The software will tell you which numbered boxes to get the information from.
And don’t be intimidated by W-2 forms. They’re typically four copies of the same information on one sheet of paper. Cut out one of the forms to avoid being overwhelmed.
Students will have a 1098-T. Ask for their 1098-T for the previous year as well. And if they’ve been in school (post-high school) for under four years, select the American Opportunity Credit so they can possibly be reimbursed for school expenses.
School expenses include: books, online codes, typical supplies.
This does not include parking permits, or tech equipment not explicitly required on their syllabi.
Most people won’t even have a 1095, so you’ll just have to ask if they had health insurance all year or not. And if they didn’t, then they should have a 1095.
If they did have health insurance all year, online software typically won’t ask for you to input anything.
If your client gave you more forms than the ones mentioned above, you have two options:
- Don’t attempt. No harm, no foul.
- Try it out. If it looks as simple as inputting numbers from the form to the software, that’s because it probably is.
But for the most part, fixing everything up is straightforward and easy.
Don’t let any unfamiliar terms scare you. They are used far less common than you’d think.
Besides, you might notice that the software is eager to get you to pay to “make sure you’re doing things correctly”. These are just scare tactics.
In Case I’ve Lost You
It’s okay if you’re overwhelmed with what I’ve shared with you. But it’s nowhere as difficult as it looks.
And that’s why I recommend you only take on this side hustle if you have knowledge on the subject or if you’ve already done your taxes yourself.
In my personal experience, tax returns don’t get relatively complicated until they involve mortgages (itemized deductions) or business income.
Sometimes even situations with dependents, however that’s an issue that can only be reconciled with the parents/guardians.
But for the most part, you take information from the form and then type it into the software.
To Finish Off
By this point you’ve reached the end of the return.
This is where the client needs to sign off and file. I’ll leave the how-to to your discretion.
This includes verifying identity and such. You’ll know what I’m talking about when you get there.
You can also help your client set up their direct deposit for their refund. Or google how to pay income taxes owed if they owe money to the IRS.
Of course, this is only a very brief explanation on how to make a hustle out of helping people set up their tax returns.
If there are any questions or comments, feel free to leave them in comment section down below.
And remember kids: Don’t do anything illegal.
Until next time,