Spring is here which means that it is time to get your taxes done. This annual chore can be very stressful, especially if you are doing them yourself, but you can keep the process from driving you crazy with these simple springtime tax tips.
Decide Whether to Do it Yourself
Even if you get a tax professional to complete the forms, you will still need to collect all the supporting documents. A tax specialist knows what information is necessary and understands the current tax code, but there will be a charge for their services. Even if you use a tax program to complete the form, some time and attention will be necessary to get all the necessary information together.
If you are knowledgeable about tax regulations, your tax return is relatively simple, or you enjoy assembling pieces of information and making calculations, you may not mind completing your own return. But if you are very busy, hate the entire process, or find it all too confusing, it may be worthwhile to hire someone else to do your taxes for you.
Get Your Documents Organized
Whether you do your taxes yourself, or hire a tax professional, organizing your documents is extremely important. You will need to know whether you are eligible to subtract mileage, business expenses, upkeep, depreciation or losses from your income and then look for documentation to support your deductions. Next, get all your tax returns and payment records, receipts, invoices, credit card records, bank statements, and check registers together.
Itemizing Your Deductions
Depending upon your income sources and financial obligations, you may decrease your tax liability if you qualify to itemize your deductions. Even if you do not own a home you may be eligible. Your age, health, number of dependents, and your work situation can all be factors. The tax code allows tax payers to deduct transportation for medical visits, home improvements, charity donations and job hunting costs when they reach certain threshold levels.
File on Time
The penalties for missing the filing deadlines are quite stiff so don’t be late. Even if
you know that you owe money but are unable to pay, be sure to file your taxes by the due date. Contact the IRS and explain your situation so you can arrange to pay in installments. The IRS is dedicated to collecting what is owed and prefers to avoid having taxpayers in default.
Help from the IRS and Community Resources
If you decide to do your taxes yourself or you have questions that you would like answered by the government, there are several avenues for reaching the IRS directly.
On the Internet, you can visit www.IRS.gov. Be sure you go to the authentic IRS website and are not fooled any impersonators. Government sites always use the “.gov” suffix. Once you are there, you can click on “Español” for content in Spanish, if needed.
On the phone, you can call the toll-free customer service line at 1-800-829-1040 for individual tax issues or 1-800-829-4933 for business-related tax questions. For TTY/TDD, call 1-800-829-4059 for information or to order forms or publications.
In many communities, free tax preparation is available through Tax Counseling for the Elderly (TCE) sites and Volunteer Income Tax Assistance (VITA). The largest TCE participant is AARP and they can be reached at 1-888-227-7669. To find the nearest VITA location, call 1-800-906-9887 or check local newspapers and publications.
It is said that nothing is certain but death and taxes. You cannot avoid the first, and if you try to evade the second or make mistakes on your return, you’ll pay a bigger price later. The goal is to make the entire process as painless as possible. You want to pay only what you owe, but you can limit your financial liability by knowing all your legitimate deductions and how to claim them. Like taking bitter medicine, the sooner you do it, the sooner you will have the problem behind you. Be sure to ask for help if you need it and enjoy the spring.
