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Tips of the Season
January to April – Tax
Season
 It’s
a bright sunny day, the birds are singing, all is well!
You go to your mail box, and what do you see there –
the dreaded tax forms for the year! The harsh reality of
this “college term paper of the real world” can be softened with these tips.
Create
a master file for all tax related papers
Even before your 1099 papers arrive, start a master file using an
expanding red folder and manila files. Label the files with the
important tax categories –W-2 information, interest and dividend
income, capital gains and losses, charitable donations, medical
and dental expenses, deductible business expenses, and miscellaneous
deductions (educational expenses, safe deposit boxes, financial
planning). Even before your papers arrive, this file will be their
“home” and papers will not get lost! And to prepare
for the current year, begin a master file for incoming documents
for the current year, so you will not have to search for them at
this time next year.
Set
aside time on your calendar to collect tax related information
Around January 15, mark your calendar for a 2 hour tax session with
yourself! Go through your checkbook and files to find important
items to copy for accounting purposes. If you already use an accountant,
usually a tax preparation document will arrive for you to base your
information. Three weeks later in February, again mark a 2 hour
tax session to wrap up those loose ends and file your documents
in your master file. If necessary, two weeks after this set up one
more session for yourself to complete your work. You are then prepared
to begin your actual preparation or send your information to your
accountant.
Use
technology as your assistant
Financial software can rescue you from your tax nightmare! Beginning
this year, load Quicken on your computer! Enter your checking information
using the pre-set categories, and Quicken has tax information categories
set. So as you pay your monthly bills, you are also categorizing
items for your taxes. Simply go back to the program and create your
tax information with a click of the mouse!
File
electronically
Nothing is more of a nightmare than to have finished your tax work,
and then to stand in the long line at the post office! File electronically
with the IRS, and upon receipt, you will receive confirmation!
And
finally, don’t delay and put off your work! The earlier you
file, the earlier you receive that wonderful refund check! If you
owe taxes, you will feel better if you complete your tax work, and
know the amount due. And remember - if I can assist you in your
document organization, please call!
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