Tax time is among the most feared and dreaded things for many of us. You can make this process a bit more bearable by getting your paperwork in proper order. Take a few of the following tips to tame your tangle of papers and come through the next tax season with gold stars.
1. Don’t wait until you are ready to prepare your taxes before you gather your paperwork together. Instead make a check list of everything that you will need including your W-2, 1099, mortgage and interest statements, business receipts, etc. making a list will help you identify what you have on hand, what you will need to look for and what you will need to request duplicate copies for. If you need previous returns for reference there is a form available at www.irs.gov. Request your copies several weeks in advance of the date you plan to complete your tax forms. Another tip: Ask your childcare provider to prepare your payment statement for tax purposes as soon as the year ends and put it away for safe keeping. You will not be able to deduct this expense simply by adding up payments in your check register. You will need the provider’s tax id number to complete your return. ,
2. While you are getting organized, start thinking about next year. It’s never too early to plan. Make a trip to your local office supply store to buy the supplies that fit your needs. Look for something that is user friendly and that you are likely to employ consistently. Some examples include accordion files, file boxes or even manila envelopes if you don’t have too much paperwork to store. The key is to designate a place that you consistently go to to store and retrieve all of your tax related paperwork.
3. It is a good idea to review all of your documents for accuracy. Although uncommon errors do occur. You can check your W-2 or 1099 against your payment statements.
4. Whether you plan to use a software or web-based program or do your taxes the good old-fashioned way (by the book) it is a good idea to have your materials on hand before you are ready to begin. If you are new to the software or web-based program be sure that you read and understand the programs completely before you begin. Don’t forget to save your work in case of a power outage or problem with your computer. If you are using the tax book don’t forget your calculator.
Doing your own taxes doesn’t have to be a major headache. You can manage the task well when you take a little time to organize. Get your materials and supplies together, take your time and above all – don’t wait until the eleventh hour; you are likely to make more mistakes or miss obvious deductions when you are anxious and pressed for time.