As the April 15th tax deadline approaches, many Americans are feeling the familiar pressure that comes with tax season. At Nextdoor, we surveyed 1,000 U.S. adults to understand how our neighbors are approaching this annual financial event, and the results reveal some interesting patterns about tax preparation, financial stress, and changing behaviors.
The Tax Season Paradox: Knowledge Doesn’t Equal Confidence
While Americans report feeling more knowledgeable about taxes than other financial categories like investing or retirement planning (65% consider themselves knowledgeable about filing taxes), a significant majority (81%) wish they understood taxes better. Despite this relative confidence, 65% of respondents view tax season as a stressful period.
What’s causing this stress? The top challenges identified by respondents include:
- Gathering necessary documents (41%)
- Worrying about owing money (40%)
- Understanding tax laws and deductions (39%)
Filing Habits Are Shifting
Most Americans plan to file their taxes well before the deadline, with February (30%) and March (32%) being the most popular months. However, compared to last year, we’re seeing more people waiting until the last minute, with 36% more planning to file in April.
When it comes to how taxes are filed, the majority (58%) plan to personally prepare their returns, while 42% will use a professional service. Tax preparation services are growing in popularity, showing a 20% year-over-year increase. For those who file personally, saving money is the primary motivation (67%), followed by getting taxes filed faster (38%).
Embracing New Technology
Perhaps the most surprising finding is Americans’ growing openness to using artificial intelligence for tax preparation. One in three respondents would trust AI to assist with their taxes, while another third are open to AI assistance but would want a human review before submission.
Refund Expectations and Plans
Compared to last year, fewer Americans expect a tax refund—54% versus 64% last year. For those anticipating a refund, 55% consider it “very important” to their overall financial situation.
How will people use their refunds? The priorities are practical:
- Put into savings (27%)
- Cover everyday expenses (17%)
- Pay down debt (15%)
- Invest it (14%)
For those planning discretionary spending with their refund (on home improvements, splurge purchases, or vacations), 52% plan to spend within a week of receiving their refund.
The Bottom Line
Tax season remains a significant financial checkpoint for Americans, combining financial knowledge, planning, and often anxiety. As technology evolves and economic conditions change, we’re seeing adaptations in how people approach this annual task—whether that’s embracing new tools like AI or adjusting expectations about refunds.
Have you filed your taxes yet? Join the conversation with your neighbors on Nextdoor to compare notes and maybe discover local tax resources you hadn’t considered.
