We asked experts for tips on managing stress as tax day approaches.
It is tempting to procrastinate: The Internal Revenue Service project that it will be receiving extensions requests from more than 20 million people this fiscal year. Perhaps we wait because it takes 13 hours for the forms to be filled out. Perhaps tax time forces us into a topic that we are often reluctant to discuss: finances.
According to an American Psychological Association survey, 65 percent of Americans consider money a major cause of stress. There is evidence that chronic stress due to financial worries can cause physical and mental problems as well as insomnia.
Megan McCoy is an assistant professor at Kansas State University’s department of personal financial planning. “People see money as numbers on a tax bill, but it’s not,” she said. “Money is all about power, control and safety. It’s also about your future. While it’s all about survival, we try to suppress the emotions that arise.”
As tax day approaches this year, it’s April 18. I reached out to experts for advice on managing stress and dealing with emotions surrounding money.
You can exchange money stories with people who share your expenses.
The American Institute of Certified Public Accountants conducted a 2021 survey that found that financial decisions can cause conflict in nearly three quarters of married couples. Kristy Archuleta from the University of Georgia, who teaches financial planning, says tax time can cause all that tension.
Marsha Barnes, a certified financial therapy in Charlotte, N.C., stated that financial beliefs, emotions, and behaviors often stem from the experiences of our families. This can help to build empathy and understanding when you have different perspectives. It can also make it easier to file taxes and have conversations about money throughout the year.
Dr. McCoy recommended that you and your partner discuss your “money stories” in detail. You can ask questions such as: Who paid your bills? Which early money memory is the most embarrassing and proudest? What did your parents do to money that you wouldn’t do?
She said that these are “powerful conversations” you have probably never had with your partner.
Do not procrastinate.
Jason Radley is an associate professor at the University of Iowa’s department of psychological and brain science. He found that when people are exposed life stressors, they have lower levels of stress hormones.
So don’t dawdle, said Dr. McCoy. She said that facing financial problems head-on is the best way to avoid them. “The sooner you determine your tax situation, the sooner you can speak to the government about a payment schedule and lower-interest options.”
Even if the prospect of writing the government checks is not a daunting one, it’s possible to be too rushed to file.
Plan for tax season by incorporating coping strategies.
Dr. McCoy suggests a way to manage anxiety. List all possible scenarios that could happen when you do your taxes. She suggested that you might be afraid you will owe money. She suggested that you make a list of your worries to determine which scenarios are most realistic and should be addressed.
For example, if you are afraid that you will be audited, a fear that the I.R.S. Reports are more prevalent among Generation Z and millennials. However, I have good news. According to Syracuse University research, the odds of this happening are about 0.38 percent.
The I.R.S. is available to most taxpayers. Free File program allows taxpayers to electronically file and complete their returns for no charge, according to Ken Corbin (commissioner of the I.R.S.’s wage and investment division). Some taxpayers are eligible for the free I.R.S., he said. Volunteer Income tax Assistance to assist with tax form preparation.
Stress can be reduced by starting earlier. Next year, I will remember my anxiety about tax time and channel that energy to filing early. (Every year, I.R.S. announces the earliest date that you can file. The I.R.S. announces the earliest filing date; this year it was January. 23.)
Corbin recommended that you create a record-keeping program right after filing your 2022 tax return. This is a reminder to the I.R.S. that “tax season” can be any time of year. Corbin said, “You’ll be happy you did.” “You can do it.”