3 Tax Preparation Tips
Households all across the country are breaking out their computers, their calculators, and their Tylenol as they push through another tax season. It can definitely be time-consuming and stressful to gather all the necessary paperwork, fill in figure after figure, and hope at the end that you did everything correctly. When it comes to taxes (and making them as painless as possible), good preparation can be the key to success.
Here are a few tips to help you get your ducks in a row:
1. Revenue, forms, and paperwork.
Nothing will derail your tax session like realizing you don’t have that one form you really need, so make sure you’ve thought through your paperwork ahead of time. You’ll need documents present for every significant revenue stream from the fiscal year: W-2s from every place of employment, 1099s if you did any contract work for which you made over $600, and records of any other business income, unemployment income, rental properties, and so on. If it was a significant source of dough, you’ll want the paperwork to back it up.
Also, be sure to spend some time researching deductions for which you may be eligible, and then round up the paperwork you need to pursue them. Depending on your situation, you may be able to deduct certain business expenses, childcare expenses, charitable contributions, medical expenses, and the like.
Finally, make sure you have a personal check handy. Nothing stings worse than reaching the finish line, setting up the direct deposit of your refund, and then having to pull the plug because you don’t know your bank’s routing number. (Hint: If you’re a client of Fortifi Bank, our routing number can be found right on the bottom of our website homepage.)
2. Give yourself time.
Rome wasn’t built in a day, and your tax report won’t be either. This stuff takes time to do, and even more time to do properly. It’s going to be quite the process no matter how you slice it, so don’t create additional pressure by waiting until the morning of April 15th to get started. As soon as you receive all the paperwork you need, it’d be a good idea to get cracking. You don’t want to jump through the hoops of filing for an extension if you can avoid it.
3. Get help if you need it.
If you’re a seasoned pro and want to do this whole thing old school with a slide rule and a sharp pencil, more power to you. If you’re like most of us, start researching your options for software and tax professionals and see what best fits your needs. If you’re relatively organized, confident that you have all the necessary paperwork assembled, and have the time to spend getting it done well, software like TurboTax can be a great tool to help you get everything submitted properly. If you prefer a personal touch (or you just don’t want to be involved in the process at all) a tax professional might be the right answer for you.
Tax season can be a stressful time; full of many “i’s” to dot and “t’s” to cross. It certainly is a daunting task to gather together a years’ worth of complicated financial paperwork and organize it exactly how the federal government wants you to. But if you give yourself plenty of time knock it out, check that you’ve got all the documents you need, and take advantage of electronic or personal tax aids to help you get the job done, you’ll be cashing that refund check in no time!
Wondering what to do with the cash you get back? Here are five responsible ways to spend your tax return.
This does not constitute professional advice. It is always best to check with a tax professional regarding proper tax documents and deductions.