Look, we know you don’t love doing taxes. We get it!
But just because you don’t enjoy filing your taxes each year, that doesn’t mean you’ll be able to avoid it forever. Even if you hire a kick-butt tax preparation firm like us, you may still be called to help out a friend or family member at some point to complete their taxes on their behalf.
Wait, that can happen?
It happens all the time. Filing taxes for someone else may not happen all too often for most taxpayers—for reasons we’ll explain later—but it happens nonetheless. There are dozens of situations that might prevent someone you know, often a family member or close friend, from filing their taxes.
In case you find yourself in a position where you need to lend a helping hand come tax season, we’re here to help. From the legal basics to other helpful reminders, let’s kick this off.
Whether you’re simply lending a hand to an elderly neighbor during tax season or filing a return on behalf of a family member who is in the hospital, you’ve got some work cut out for you. We won’t overstate this, because you get it—taxes require hard work, blah, blah—but we do want to explain very quickly why.
Even though you’ve taken on the responsibility of someone else’s taxes, you aren’t ultimately responsible for them. By this, we mean the person whose tax return it is will still be on the hook if you mess something up. Heck, even a tax preparation company technically isn’t on the hook, though the reputable ones (like us) guarantee support in case the IRS has any questions or chooses to audit.
If someone asks you to prepare their tax return, they can—and should—list you as a “Third Party Designee,” located just above the signature on their tax forms. This will allow the IRS to speak with you about the return in case you unintentionally omit information or have questions about processing.
If you are filing on behalf of someone who is sick and unable to do it his or herself, they may grant you power of attorney to sign their return. However, this can also be a really useful tool for when someone is in the military or taking an extended international trip, typically of 60 days or more.
If this person happens to be your spouse, you can be authorized to sign for them on your joint return without jumping through too many extra hoops. Your partner will just need to file Form 2848 to give you the power to sign their federal return.
After the emotionally and mentally draining experience of losing a loved one, a jarring realization for many is that the person’s taxes still need to be filed. Usually, the executor or estate administrator will handle this task, but if a person hasn’t been specified, you may have to fill the role.
Filing for a loved one you’ve recently lost is challenging enough, but it also carries the added difficulty of locating the needed documents. Fortunately, the filing process is relatively straightforward from there.
Taxes are a part of life, and many children will find themselves needing to file a tax return before they turn eighteen. If your child meets certain thresholds of investment income, wages at a summer job, or other incomes, they may need your help filing.
If your son or daughter meets those thresholds, they’re responsible for signing and filing a return—but you can help file on their behalf. This is another reason why it’s good to teach your kids about finances (and taxes!); the earlier they learn good tax habits, the more they’ll benefit throughout the rest of their lives!
When you’re filing taxes for a loved one who can’t file on their own, you have your work cut out for you. But you shouldn’t let that overwhelm you! If you’re fortunate to have some advanced warning about your need to file for someone else, it may be time to loop in help from a professional.
Even if you’re grappling with loss, it’s worth asking for help. Reading up on how to file for a loved one can take you far, but you may feel more comfortable and at ease by securing some additional guidance.
You can do this. We promise.