Filing income taxes is a hassle and most of us wait until the last moment. Here are some ideas to make the process easier.
You will need reportable income Internal Revenue Service forms like a W-2 or 1099, depending on your filing status. If you are self-employed, you might also need Internal Revenue Service form 1099PATR to report bad debt collected, prior business purchases and scrap sales.
You may want to have other paperwork handy so you can refer to it while filling out your return. Things like your mortgage payments and real estate tax receipts are helpful to have to use as references. Receipts for home improvements, especially ones related to energy savings will help as well
If you purchased a new car, you can deduct your state, local, and excise taxes, so dig those records out. Also, if you purchased a hybrid vehicle, you can get a tax credit of up to $7500 or $4000 for a plug-in conversion kit for your car. You will want to have all your records of these purchases on hand while filling out your return so you can refer to them easily and specifically.
If you purchased a new home, you can receive as much as $8000 in tax credits, so you will want those records accessible, too.
The central point here is to be organized. Be prepared to file your income tax return before you begin filling out Internal Revenue Service forms. The first and obvious thing will be to know which forms you are filing and have them on hand. Then have all of your supporting paperwork ready to go. You will probably need to refer to everything you have, in order to get the numbers right. This will include things like receipts for charitable donations, gasoline purchases, home office equipment purchases, and many others depending on your filing status.
If you are filing online and expecting a refund, you will want to have a bank deposit slip so you can enter the correct numerical information for deposit. Remember that you do not have to have the money direct deposited into your checking account. You can have your Internal Revenue Service refund direct deposited into an Individual Retirement Account or any other type of account that has accommodations for electronic deposit.
Here again, it is recommended that you consider consulting with a tax professional and have them file your return. You will still need to pull these records, but a tax professional will provide with a clear list of what you need to gather before you see them for the actual filing. They usually don’t miss anything and that makes the whole routine easier on you.