Do you remember your very first tax return? If you filed that return before the World Wide Web arrived on the scene (1993), perhaps you talked with your parents or older siblings to learn what to do.

Now, life is very different. In today's world, you might turn to online resources for help.

But first things first: Do you have to file a tax return?

To find out, go to the IRS webpage "Check if you need to file a tax return" (tinyurl.com/4pu4ct2n) and look for "Who must file."

You'll see a list of three items, one of which is a very low dollar amount: "You have over $400 in net earnings from self-employment (side jobs or other independent work)."

You might find that odd in light of a second, much higher dollar amount that refers to income being "over the filing requirement" ($15,750 for a single filer for 2025 -- tinyurl.com/mu79d76e).

The difference has to do with how the money was earned. (See the Filing Information and Standard Deduction chapters of IRS Publication 17, "Your Federal Income Tax" -- tinyurl.com/bdfcrhjn).

To best understand how these different amounts may apply to you, try out the Interactive Tax Assistant (ITA) tool, which is found on the IRS webpage "Do I need to file a tax return?" (tinyurl.com/2jv5mv8s).

Using the ITA tool, compare Jimmy to Mike. Jimmy earned $500 working at a coffee shop. His employer will report his earnings on a W-2. Mike earned $500 doing odd jobs for a neighbor, with no W-2.

Jimmy has "earned income" of $500, far below the filing threshold of $15,750; he does not have to file.

"[E]arned income is the salaries, wages, tips, professional fees, and other amounts you receive as pay for work you actually perform," according to the ITA.

Mike does not have W-2 income. His earnings are from "self-employment." The ITA asks: "In 2024, did you have net earnings from self-employment of at least $400?" Because he earned $500, he does have to file a tax return and he will be required to pay roughly $70 in self-employment taxes (see the NerdWallet article "Self-Employment Tax: What It Is, How to Calculate in 2025 and 2026" -- tinyurl.com/39ew36zj). However, he will not have to pay income taxes, since his income is less than the federal taxable threshold of about $14,600 for a single filer.

Mike's earnings fall under the term "gig work," which is described at the IRS webpage "Manage taxes for your gig work" (tinyurl.com/mpu56edj).

Let's assume that you have to file a tax return. Given that we're a few months away from the end of the calendar year, the best you can do right now is to estimate your earnings to get ready for the actual tax filing in early 2026.

You'll finalize the return after you receive your W-2s, 1099s and other tax forms that report other types of income early in 2026. A W-2 is a wage and tax statement issued by an employer; 1099s report non-employee payments (freelance or gig work, interest payments, and so on).

Think about filing your return electronically to take advantage of the step-by-step process online programs take you through. If you do file electronically, and a tax refund is due, you will get your refund faster -- "usually in less than 21 days," according to the IRS (tinyurl.com/53y2urzm).

The IRS Free File program is one option. But you have to be below certain income thresholds (about $84,000) to qualify for a free filing (tinyurl.com/yu8vbbn6).

For additional resources, read the Bank of America Better Money Habits article "6 steps for first-time tax filers" that points out that "[f]iling your own taxes is a key milestone" (tinyurl.com/yvv4rcd6). Indeed it is.

Also check out the TurboTax article "5 Tips for How to File Taxes for the First Time" (tinyurl.com/2wpwbnfb).

DISTRIBUTED BY ANDREWS MCMEEL SYNDICATION

"Heather" wrote to me about frustrations she would experience if she were to receive an unexpectedly large inheritance from her parents. Asking for guidance, Heather raised some very good questions, which I share here in her words.

Q: "I don't even know what I would do first? Contact my investment adviser, my accountant, a lawyer?"

A: Your parents will need to guide you on who they see as their trusted advisers. Some people will be guided by their lawyers, some by their accountants, and others by firms that specialize in offering broader services that cross over between tax, law and investment management, with more of a "family office" structure.

As a start, ask your parents to share information and insights about their advisers -- who is their key adviser for important financial and legacy decisions (do they have one person in mind, or more)? Would they recommend their advisers to their friends (why or why not)? (The last question will give you insights that go beyond whether the relationship is simply "friendly.") In my view, from decades of service to high-net-worth families, I would strongly avoid asking about money, from net worth to the size of a potential inheritance. Respect your parents' privacy.

Q: "Is the inheritance counted as income?"

A: The inheritance itself is not "income," in contrast to, say, a paycheck. However, the assets that you inherit will likely create taxable income and capital gains that you will be responsible for after you receive the inheritance. You will need tax counsel or a CPA to go through a breakdown of assets and types of accounts. As a start, find out who your parents use for tax preparation, and consider getting an introduction so you can learn more about how the CPA or tax adviser works with clients.

Q: "Or is it just an inheritance, and I pay inheritance taxes (per my state or my parents' state?)?"

A: The answer depends on the size of the estate and the residency of the deceased.

There are two levels of estate taxes (federal and state) that are paid by the estate itself -- but it will not be subject to taxes if the size of the estate falls under certain thresholds. On a federal level, estates that do not exceed $13.99 million (as of 2025) are free of federal estate taxes (tinyurl.com/hxy5rz97).

As to states, it depends. My home state (Connecticut) matches the federal exemption. That means that if your estate does not exceed $13.99 million, there is no Connecticut estate tax (tinyurl.com/2uzewjrh). To look up other states, a good resource is The American College of Trust and Estate Counsel's State Death Tax Chart (tinyurl.com/mrjvy84f).

Q: "What stock prices get set back to zero -- no cap gains?"

A: This question has to do with the step-up in basis that an inheritor receives. A Fidelity Investments Viewpoints webpage describes it this way:

"[I]f a person holds property at death, it will receive a new basis equal to the fair market value of the property at the person's date of death. In the case of appreciated assets, the rule allows people to inherit the assets, such as stocks or real estate, without inheriting the tax burden that's triggered by capital gains" (tinyurl.com/4j6wypb6).

Q: "Should I hold off selling any investments if I don't need the money right away?"

A: Actually, the opposite could likely be better, but you will need to seek advice first. There are two issues: 1) taking advantage of the step-up in basis, assuming, of course, that capital gains taxes would be due but for the step-up (unrealized gains on taxable assets) and 2) tailoring the inheritance into a tax-efficient portfolio that suits your needs.

The most important takeaway is not to push parents to divulge dollars -- or anything else. A reasonable request is for parents' experience and insights about their advisers. Who do your parents respect and admire? If they don't have a ready answer, that's a red flag.

On another note, if you live in or near Greenwich, Connecticut, and would like to learn more about raising funds for charity using IRAs, I'll be presenting on the topic at the public library on Nov. 5. For more information, see juliejason.com/events.

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A column I wrote about surprise inheritances a few months ago resulted in a number of reader letters. Let me share one with you in full, because it tells a person's real experience, spelling out a cautionary tale:

"In the 1980s, when I was in my 40s, and my father in his 80s, we were discussing his estate planning, but he had been vague, mentioning that he was speaking with a trust department at a bank but hadn't made up his mind. I asked him how much money he had. When I asked directly, he responded angrily, 'None of your business.'

"When he suddenly passed away a year later, the trust department told me they would take care of everything, and to return to my town. However, it turned out he had never signed the trust documents, and a judge ruled that the trust department's actions were dishonest. As a result, I received a substantial inheritance.

"I was raised poor by a man who was extremely frugal, so the vultures quickly began circling, offering advice on how I should handle the inheritance of stocks, bonds and real estate. They suggested I turn the money over to them, invest in their personal projects, or lock it up for years in REITs [real estate investment trusts]. I was also pressured to sell three generations' of family-held stock to cover estate costs and hold on to stocks of companies I didn't want to support: oil, alcohol and tobacco. The pressure was overwhelming, with strong suggestions that I act immediately.

"These were all men doing this. The attempt to steal the estate; the pressure to invest in their pet projects. They even said things along the lines that a woman could not possibly understand the complicated world of finance. They pointedly stated that I was going to lose all the money unless I acted quickly.

"I ignored all advice, as everyone advising me had something to gain. Instead, I found people who worked on small commissions to teach me how to invest wisely as I timidly used dividends from the stock to begin diversifying. (Yes, I sold everything but the family stock to pay his estate taxes, so I had work to do.) I read business books. I learned about companies. I learned about stocks and bond investing. I waited several years before taking any action.

"The lesson here? Watch out for the vultures. Are the people advising you truly acting in your best interest, or do they stand to gain something beyond your gratitude? Even respected figures in my life tried to pressure me into decisions that didn't feel right."

This story is one person's actual experience. Hopefully, it won't be yours. In addition to normal cautions that should always be present when losing a parent or a spouse, the reader's mention of gender makes me pause. You would think no one would comment that a "woman could not possibly understand the complicated world of finance," but it still happens today.

You would also think that no one would pressure someone to take action by suggesting that the person would "lose all the money unless [he or she] acted quickly."

Thankfully, the reader removed herself from the relationships that were not serving her well. She also began to focus on "learning" before "doing." That's a good road to follow.

As to gender, since females statistically live longer than males (tinyurl.com/v6sdkpjv), more and more women will be faced with new situations that will call for them to make difficult decisions, whether they are prepared or not.

So I ask you: If you are married, are you prepared to take over if your spouse predeceases or becomes incapacitated? If you are single and due to inherit someday, are you prepared? Next week, I'll share another reader's letter.

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