Doing taxes drives younger generations to tears

Tax season underway: What you need to know

Wealth strategist and tax expert David Ragland joins LiveNOW's Lexie Petrovic to outline what Americans need to know when filing their taxes as tax season begins.

Few people enjoy doing their taxes, but for younger Americans, it's stressful enough to make them cry – or possibly even send them to a therapist.

"For me, it's stressful because I don't really know what I’m doing yet," Generation Z taxpayer Ella Howell offered.

"There are tears every year," agreed fellow taxpayer Megan Starkey.

A recent Cash App Taxes survey revealed 54 percent of Gen Z and 38 percent of Millennials report the stress of filing taxes has either brought them to tears in the past or they expect it will this year.

Furthermore, one in four Gen Z-ers responding said they'll need help from a therapist to recover from the experience.

"I’m not surprised that filing taxes is overwhelming and a cause of stress for Gen Z and, sort of, younger Millennials," said Brett Weiss, head of financial wellness at Facet.

Weiss says money is the number-one cause of stress across all generations. But he assures everyone that filing taxes doesn't have to cause anxiety, chalking the roadblocks up to lack of tax education in schools and, for younger generations, an increase in less-traditional sources of income.

"Gen Z and Millennials, too, they're very entrepreneurial," Weiss continued. "They might own businesses. They might be creators or influencers and they have all these different various forms of income, not to mention investing in maybe crypto or stocks. All of these different income sources create complexity and that can absolutely lead to confusion and ultimately stress when it comes to filing your taxes."

Taxes are a major cause of stress for many filers, especially younger generations. (File: Poike / iStock / Getty Images Plus)

The survey also revealed 62 percent of first-time filers are not sure where to get their W-2s or 1099s.

Weiss says the best place to start is to simply get everything organized. That includes listing all the ways you make money, all the things you own, and all your debts. Then find the appropriate tax forms.

"It's important to understand not all of these things are going to impact your income tax returns," he noted.

And if this is still overwhelming, consider turning to a third party.

"Companies like Cash App, maybe a TurboTax and H&R Block, offer very affordable, even free in some cases, tax-filing programs. And now, they even offer sort of guided expert advice to walk you through the process…and put you in a better position so you can spend your time doing other things than worrying or stressing about filing your taxes."

Nearly half of Gen Z and more than a third of Millennials are unsure of the tax deadline, which is April 15.

Personal Finance Personal Finance