Written By: Mallory Mims
The New Year brings the hectic business of scrambling to round up everything needed for tax season. The frantic search begins for all those old, faded receipts stuffed into every nook and cranny of wallets and purses or scattered around the house. In order to avoid the last minute rush and to streamline your tax return preparation, we have compiled a list of simple steps to help you get organized for 2015.
1. Use your 2014 return as a starting point – TJSDD will send out annual tax organizers, but in the meantime, you can use your prior year tax return as a checklist for 2015. Make a note of the information included and begin collecting necessary receipts and tax documents as the year progresses.
2. Consider using accounting programs – Tracking your personal finances and chasing down receipts can seem daunting. Using electronic programs, such as Quickbooks or Quicken, allow individuals to quickly create reports that track spending in areas such as charitable giving and medical payments.
3. Stay organized – Keep tax-related receipts and documents filed in a certain place, whether that is a home office or a designated kitchen drawer. Having all information stored together will save time and effort next year, eliminating the need to chase down documents from earlier in the year and missing potential tax breaks.
4. Note any key life changes – As your life changes, your accountants need to know! Make sure to note any marriages, births of children, buying of homes, starting of businesses, or other changes.
5. Watch the news – Keep your eye on any proposed tax law changes that may affect your tax situation. If you think a law change may apply to you, consult with your accountant any potential tax consequences or ways that you can mitigate such consequences.
6. Be proactive – Be on the lookout for additional ways to reduce your taxable income, such as energy-efficient improvements related to your home, additional mortgage interest payments, medical miles driven during the year, and excess charitable giving.
7. Collect year-end documents – There is a surplus of documents delivered throughout January and February of each new year. The arrival of W-2s, 1099s, and brokerage statements can be overwhelming; use the checklist from step one to make sure that no documents are overlooked or missed. As businesses move into the electronic age, keep tabs on your e-mail inbox for any critical tax forms delivered in that medium.
Tax Season can be a scary and intimidating time, but using these quick tips can help taxpayers save time and energy as the crunch of tax deadlines creep up. Staying organized and being proactive can help take the pain out of your tax return!