If you're on a quest to find a person who loves to pay taxes, you'll probably be looking for a while. The reality is that most people don't enjoy tax season; however, much of this discontent and stress is avoidable. There are several things people like yourself can do to make tax preparation a lot more enjoyable, and easy.
Do a Year Recap
A year is a long time, and a lot can happen in a year. One of the greatest mistakes taxpayers make is forgetting how the changes they experience throughout the year will impact their tax status. Sure, major changes like having a child or getting married matter.
However, selling your home, starting a new job, and transferring your 401k are also changes that can impact your taxes and may change what information you need to report. Sit down and perform a quick recap of any changes you experienced during the year. If you're married or own a business with a partner, sit down and do this recap with the other person.
Collect Your Records
It's also important for you to collect all your financial records. Your bank statements, previous year returns, payroll records, accounting documents and any other financial information you have should be gathered and stored in a convenient place. Collecting these records will make your preparation go by faster and most importantly, it will ensure that your returns are more accurate.
When it comes to auditing, no income level is free from the risk of an audit, so you can be selected. In the event you are selected, you will have the records to match all the claims you've made on your taxes.
Research Tax Changes
A lot of people overlook the fact that the IRS makes changes to the tax rules and codes every year. Although these changes aren't always substantial, there are subtle changes made periodically. Before you begin preparing your taxes, sit down and research the tax changes that pertain directly to you.
In your research, you might find that a credit you once claimed is no longer available, or the rate at which you're able to depreciate your business assets has changed. It's much better to find out about a change before you file than to wait and get hit with a penalty. Tax season provides several weeks for filing, so take your time and do your research.
When it comes to your tax preparation, make certain you aren't overlooking the benefits a professional installer can offer you. Don't hesitate to reach out to a professional for assistance.