Holy Taxes! Are Your Taxes Too Taxing?

Tax season is upon us and many people find the annual ritual of pulling together their information daunting. With a little organization, it doesn't have to be such an onerous project ... 

Tax Tips

• Half the battle is starting to gather information early in the game. If a document is missing or an issue arises, you won't have to scramble or worry about filing late. If you're due a refund, you'll receive it sooner if you file early.

• Set up a good record-keeping system to create peace of mind, whether it's a computer program or a paper-based method. Once you have a system, you can use it year after year to simplify the tax process. 

• Designate a place to store tax-related correspondence, whether it's a file folder, accordion file or a clearly labeled box. 

• Classify gifts, which are not taxable. Your tax preparer could see these deposits as income.

• If your return is complex, hire a CPA so you don't overlook deductions. Accountants are aware of the latest tax laws. In addition, a neat, organized computer-generated return helps to avoid an audit. 

• Review last year's return with your accountant to see if there is any carry forward information. 

• CPAs often send a helpful list of documents required for tax preparation as well as questions relating to your current tax status so nothing important is overlooked.

• If printing out from a computer program, ask your accountant what formats he would prefer to receive.

• Organize support documents by category: income statements, investments, receipts for deductible expenses, and letters of charitable donations. 

• Before you submit your paperwork, make a copy of it and all supporting papers. This will help if you need to check back or file an amended return.

• I recommend keeping all tax returns but you may shred backup material after seven years. 

If you need help setting up a tax system or preparing documentation for taxes, call me ASAP at 718-930-8111. I look forward to helping you file on time.

No comments: