Early Tips for Tax Season
Yes I know. Tax season doesn't make any of us jump for joy. But by not waiting to the last minute like we do year after year, the process can be a bit less painful and a bit more seamless.
Make a system. By taking the time to lay the foundation for organized, easy-to-navigate, and (more importantly) easy-to-file system, you set up a platform to make it easier for following the next tip. Aside from that, you won't have to spend hours searching all over the house.
Stay on top of things. You need to review and keep track of all your tax documents AS THEY COME IN. It's just about getting in a habit; like taking your shoes off when you come indoors. Putting things in order though they year is so much easier than trying to compile it all at crunch time.
Know your finances. Namely, know if and when you have to pay back any of the "Making Work Pay" tax credits. You don't necessarily need to keep a ledger or crank out statements of free cash flows (FCF) or balance sheets, but it doesn't hurt to know about the comings and goings of your finances.
Read the paper. Know about all the changes in tax law and how these changes affect you. This can help you prepare for when it comes time to file.
File electronically. I can't prove it, but I think the IRS hates mail-in returns so much now that they audit them on a more frequent basis. All assumptions aside, electronic returns have 13% fewer mistakes.
Get on it. It's logic really. If you start early you can probably find more deductions and get the largest return possible. Or you could just wait and take the standard deduction like you do every year.
This tax season, actually get ready early and don't just say you will. Get after it in small manageable increments.