Tax Season, Simplified

The deadline for filing your 2025 income tax returns is April 15, 2026. Taxpayers needing more time can request a six-month extension to file by October 15, 2026. Filing your taxes may leave you feeling confused or overwhelmed. For first-timers filing on their own or for those of us that could just use a refresher, we’ve compiled a list of tax time terms to help ease the stress of completing your taxes this year.

AGI

Adjustable Gross Income. This is all of the income you receive over the course of the year. Your AGI includes wages earned, interest, dividends and any capital gains. This is typically the first step in calculating your federal income tax bill.

Tax Deductions

Tax deductions are expenses that the government will allow you to subtract from your adjustable gross income to come up with your taxable income. Some examples of tax deductions would be student loan interest, alimony payments, and IRA contributions.

Standard Deductions

Standard deductions are the same for all taxpayers and are set by the IRS. This amount varies depending on your filing status and is adjusted based on inflation. If you would prefer not to use the standard deduction you can claim itemized deductions.

Itemized Deductions

Itemized deductions are expenses that can be deducted from your adjustable gross income that can help you reach a smaller income amount. Examples of itemized deductions would include things like medical expenses, property taxes, mortgage interest, charitable contributions, etc. For a full list of itemized deductions check out this list provided by the IRS.

Tax Exemption

An exemption is the amount the IRS allows you to subtract from your income to reflect people that depend on your income. This would include yourself, spouse, and any dependents. The IRS provides a set amount for each exemption and subtracts this amount from your adjustable gross income.

Taxable income

Your taxable income is your income minus all of the adjustments, deductions and exemptions noted above. This will be the final amount used to calculate how much you owe in taxes.

Withholding

This is the amount that is held from your wages each time you are paid and goes toward your income tax and Social Security taxes. The amount that is withheld is based upon how much you make as well as the W-4 form that you file with your employer.

Get Ready for the 2026 Tax Season

• Gather all necessary records for filing
• Review the 2025 tax law changes for credits and deductions
• Sign up for direct deposit (PFFCU has free checking)!
• File by the tax deadline: Wednesday, April 15^th, 2026
• Important Reminder: The IRS will never reach out by phone, email, text or social media to ask for personal information or any payments.

Common Mistakes to Avoid

• Missing the deadline
• Forgetting to report small income
• Misfiling information
• Not requesting an extension if you need more time

Sources: https://www.irs.gov/newsroom/prepare-to-file-in-2026-get-ready-for-tax-season-with-key-updates-essential-tips

There are a number of different tax forms and methods you can use to file your taxes. Make sure you choose the form and method that works best for you. If you still have questions regarding tax time terms or which form best suites your needs, we encourage you to speak with a tax advisor.