Filing Taxes for the First Time? 3 Things You Need to Know

Some people are exempt from filing a tax return, but this year, all people are being urged to submit one for the 2020 tax year. The reason? The IRS is currently in the process of distributing $1,400 stimulus checks as part of the recently signed $1.9 trillion American Rescue Plan. But if you don't submit a tax return for 2020, the IRS may not realize you're eligible for a stimulus and withhold that money.

Also, a lot of people unfortunately saw their income decline in 2020, compared to 2019. If that happened to you, you may be entitled to a larger stimulus than what you recently received -- and the IRS will bump you up to that correct amount once your 2020 taxes come in and it sees what your most recent annual income looked like.

Of course, if you're new to filing a tax return, you may be worried about doing it wrong or somehow getting audited. If that's the case, here are three important things you should know.

Source Fool.com