Getting Ready for Tax Season

Getting Ready for Tax Season

 

We’ve turned back our clocks, started buttoning up our houses in preparation of our winter, begun pondering the impending holidays and have given brief reflection to the end of yet another year.  As we rapidly move through the third quarter of 2012, most of us are subtly reminded of what’s looming on the horizon….the dreaded tax season!

If you are like most people, you hate thinking about preparing for tax season. Many people procrastinate because they think they have plenty of time before that April deadline. Unfortunately, this rarely is the case and we end up scrambling, oftentimes missing eligible credits and deductions and overpaying Uncle Sam.

 

However, with some planning and preparation, filing your taxes doesn’t have to be the nerve-racking, hair-pulling hassle it typically has been. Here are a few tips to help you get ready and make this year’s tax season less stressful.

 

  1. Get your paperwork together. When preparing for tax season, go through your past returns. This will help spot items you may have forgotten or remind you of questions you may want to ask you tax preparer. Prepare a folder labeled “2012 Taxes and begin filing important tax documents, statements and receipts and as you get additional end of the year items (e.g. 1099s, W-2s, etc.) add these to your file.  It’s a good idea to retain this folder with a copy of your tax return every year. It will be a lifesaver if you’re ever audited. Note: If your name has changed in the last year and you haven’t applied for a new social security card, do so now, so that it reflects your new name by tax time.

 

  1. Decide what’s the best way to do your taxes – filing yourself or hiring a CPA. Today, programs like Turbo Tax can save you money. But depending on how complicated your return is, and how much your time is worth, a CPA may be worth hiring.

 

  1. Have a chat with your working teen. If your teenager works and will be filing a return make sure you find out whether he or she is claiming himself or herself.. Typically he or she shouldn’t. Most teenagers don’t make enough money to claim themselves.

 

  1. Be Patient. Although it feels great to have your taxes done early, don’t be too overly zealous. Make sure to wait until every form you need has arrived. It will cost you more if have to file an amended return.

 

Remember, taxes are a necessary evil.  They are bound to cause some anxiety. But if you leave yourself enough time and start preparing early by following the steps above, tax season will be a breeze…or at the very least, a great deal less stressful!