For many people, the new year brings in tax season, and tax season can be stressful. Tax season involves collecting documents, filling out forms, and potentially sending money to the government. It’s a process few people enjoy, but with the right preparation, tax season can be pain-free.
Here are three tips to prepare for this year’s tax season.
- Gather important documents. Filing your taxes requires plenty of paperwork. The best way to get a head start is by gathering all of the required documents early. You can create a folder for the documents or save them in a digital format. Your important documents may include W-2s, 1099s, documents showing major business purchases or other expenses, investments and interest payments, and receipts.
- Double-check personal information. Whether you are filing taxes for business or your family, it’s important to check over information. If you are sending employees W-2s, confirm their addresses, so the documents do not get lost in the mail. It’s important to do this early because it is required that employers send W-2s by the last day of January each year.
- Plan ahead for taxes. Many businesses will owe money this tax season, and it’s important to plan ahead. Some of the best ways to avoid becoming delinquent on taxes are starting a savings account, maximizing charitable donations, and hiring a professional tax attorney or accountant. If necessary, you can always file an extension for your tax returns, and it will give you more time to gather the money to pay the government.
Whether you choose to do your taxes on your own or hire solicited them, it is still important to organize your records. Doing this in advance will save you time and money, and the earlier you start, the sooner you can be finished.