With tax season here, hopefully you’re not sporadically running around looking for your tax returns, receipts, and other important documents. Hopefully, you have also decided how you will be filing your taxes this year. But if not, have no fear! You still have two months left to file your taxes and most people haven’t even started yet. By following these tips you’ll be able to get organized and ready to file your state, local and federal taxes, but also take these tips to help you become organized for the rest of this year so that you have a smooth tax season next year.
One of the most important things to do during tax season, (which sadly most people forget to do) is to save and organize your receipts. The reason for this is because if and when you get audited you have to have proof that you made that purchase (since you are filing it for a return). Many people questions if they should really be saving all of their receipts, however saving all of your receipts will give you an accurate estimate on how much money you spend on categories such as food, entertainment, shopping, etc. Saving your receipts will also allow you to become more organized and when tax season comes around, you’ll know exactly what you can and cannot claim.
As you already know, you’ll need some important documents to file your taxes. It is your employer’s responsibility to send out your w-2 or 1099 form. (If you are self employed, you should have a 1040 or 1099 form). It’s important not to lose these forms, however, some payroll and employer services have these forms on file. You will also need identification and your social security number. Along with these, you will need to bring along any documents or forms that were received from any stocks, investments or bank accounts that you will receive. Be sure to stay organized and keep everything together.
DIY or HIRE?
Another step you’ll need to consider is how do you want to file your taxes. It may be easier to hire someone, but it could also be costly. If you make over $200,000 a year, it is recommended that you hire an accountant to do your taxes for you as they will ensure that the least amount of mistakes are made. If you didn’t make much money, are not a homeowner or a business owner, and can’t claim anyone but yourself, filing your taxes via DIY may be the way to go. For one, you will usually find out how much your return will be right away. You can also do these at home with the click of a button so it saves you time and money. However, you do take the risk of making a mistake. Again, it’s always best if you can have professional advice to help you decide which way is best for you to file.