6 Ways to Help Your Employees During Tax Season

U.S. residents filed more than 25 million tax returns in 2023, and many of them completed those returns on their own.

But as most taxpayers know all too well, filing a federal tax return without some sort of guidance can be stressful. In fact, more than half of U.S. adults who file tax returns (57 percent) find the do-it-yourself approach nerve-racking, according to a study conducted by The Harris Poll for Fast Company.

Employers can’t fill out tax returns for their workers, but they can lend some help. Here are six ways that employers can assist employees with the annual drudgery of tax preparation.

1. Know the Lingo

In terms of tax preparation, one of the simplest things that HR professionals and workforce managers can do is help decipher the jargon that tax filers run into.

Kraig Kleeman, founder and CEO of The New Workforce, recommends that HR professionals and workforce managers get up-to-speed on common tax terms, deductions and credits.

“Knowing the basics of taxes is crucial for giving good help,” said Kleeman, whose company recruits offshore talent. “This helps you talk confidently with employees and provide the right advice for each person’s situation.”

2. Hold Tax Workshops

This year, weeks ahead of the April 15 tax-filing deadline, accounting automation company Numeric invited employees to a one-hour session that reviewed tax basics such as tax planning and deductions. HR experts suggest holding similar events at your workplace.

“Ideally, this alleviates some of the stress associated with tax filing,” said Parker Gilbert, co-founder and CEO of Numeric.

An in-house accountant led this year’s Numeric workshop, but your workplace could enlist an outside expert if an internal professional isn’t available.

“As we navigate the twists and turns of taxes, let’s seize the chance to empower and support our employees on their financial journey,” Kleeman said.

3. Keep Employees Informed

Employers should update employees on tax deadlines, required documents and tax code changes, Kleeman said. “When it comes to helping with taxes, talking openly is super important,” he said.

David Feinberg, senior vice president of HR software company Justworks and vice chairman of the National Association of Professional Employer Organizations, specified that employers should:

• Educate employees about various tax documents, such as W-2s, W-4s and 1095-Bs.
• Remind employees that they were supposed to receive their W-2 forms by Jan. 31.
• Encourage employees to file their federal taxes before the deadline (April 15 in 2024), unless they obtain a filing extension.

To communicate that information, Martha “Marty” Bryson, SHRM-SCP, president of the SHRM-affiliated HR Florida State Council, suggests that employers undertake a January-to-April tax awareness campaign that includes emails, newsletters, signs and posters. This approach enables employees to sort through tax information “in bite-sized, easily digestible formats,” Bryson said.

“Repeating messages in a variety of ways will reach the most employees,” Bryson said, “and spread the message that the organization cares for them as individuals.”

Another message that employers might want to spread: Don’t forget to file your return if you’re on track to receive a federal tax refund. For the 2019 tax year, an estimated $1.5 billion in federal tax refunds remained unclaimed as of June 2023, the IRS said.

4. Offer Tech Tools

Considering that most U.S. residents file federal tax returns electronically, it makes sense for employers to share tech resources that can ease employees’ tax-filing burden.

“User-friendly tax software or apps with step-by-step guidance make the process more manageable,” Kleeman said.

Several brands of free tax-filing software are available, including Cash App Taxes, FreeTaxUSA, TaxAct, TaxSlayer and TurboTax Free Edition. In addition, the IRS and AARP, among other organizations, offer free tax-filing assistance to eligible taxpayers.

Josh Hart, founder of corporate culture and employee relations consulting firm Joshua Hart Consulting, recommends that employers look into providing discounts on tax-preparation software or partnering with tax-preparation services to help reduce tax-filing headaches.

“In the ever-changing world of HR and workplace management, supporting employees with their taxes is a big part of overall employee well-being,” said Kleeman.

5. Highlight Tax Advantages

Hart advises that employers make employees aware of tax-advantaged benefits, including retirement plans, flexible spending accounts (FSAs), health savings accounts (HSAs) and commuter perks. In some cases, these benefits can help employees decrease their taxable income.

6. Promote Financial Wellness

Promoting financial wellness can be a year-round effort, not just an effort timed to coincide with tax season. According to Hart, aside from tax help, a financial wellness initiative could feature advice about creating a budget, managing debt and building up savings.

He said: “Helping employees improve their overall financial health can reduce stress during tax season.”

John Egan is a freelance writer based in Austin, Texas.