Every year as the month of April quickly approaches, stress kicks in for many individuals, families and businesses. Many people sense the stress because they are completely unprepared for the deadline to complete their tax returns. It doesn’t have to be that way though. There are many things that can be done, and online tools to be used to better prepare for the tax season. The key to this preparation is getting started early. An individual can’t expect to wait until the week before the deadline to pull everything together. How exactly can tax season be much easier and less stressful?
Keep Meticulous Records
The lack of records, or organized record-keeping is the source of much stress during tax season. The majority of individuals do not hold onto many things that could end up saving them money on their taxes. Receipts are lost or thrown away, which can cause you to lose deduction opportunities. One of the best things you can do is find a book or make your own file folders for each month. Store the receipts you receive for such things as home improvements, property taxes, medical bills, student loans, insurance, etc. Keeping these receipts organized will alleviate a great deal of stress.
Make A Budget and Live By It
Budgeting may not normally seem like a part of preparing for tax returns, but it is vital. An individual’s complete financial success revolves around how well that person can budget their money. If a person continually spends haphazardly with complete disregard to their financial situation, the chances are strong that they will also be unprepared for tax season. There seems to be a strong correlation between the two. It doesn’t matter how much, or how little, money you make. Make a budget and live by it. Set aside a little money each month as an emergency fund that can be used if you have to pay extra taxes. There are many online tools that make tax season and budgeting much easier. One of those tools is Mint.com. You can make out your own budget, set savings goals, connect your bank accounts, any much more. In addition to this, you can also import the information from Mint into TurboTax if you choose to prepare your taxes online.
Find Someone You Trust To Prepare Your Tax Returns
Many individuals prepare their own taxes with the help of online tools like TurboTax or H&R Block. Those are completely acceptable and easy programs to use in tax preparation. These are great tools to use if you are single, work for someone else, and/or are not claiming more than the basic deductions. The best idea (especially for those who are self-employed, have complicated deductions and/or investment income) for an easier tax season is to find someone you trust to prepare your tax returns. Those individuals who have been well trained and educated can often catch more deduction opportunities than a computer program (although this isn’t always the case). To find a reputable tax preparer, do plenty of research, ask friends and other professionals. Tax season is a dreaded time of the year, but things do not have to be complicated.