With tax season just around the corner, it’s that time of year when you hop from the joys of holiday cheer to the woes of financial stress. But even as you make your way through a sea of documents and transactions, you can benefit from different suggestions to properly file your tax return.
The best part? It is not difficult to learn these tips and tricks. Even a basic checklist for tax filing can simplify the process for you and work wonders for your comfort.
To support you with the challenges of tax season, here’s a tax filing checklist for a trouble-free experience.
Continue Preparing Throughout the Year
When you look at tax-saving strategies for freelancers, self-employed individuals, or salaried professionals, you may find the advice to prepare your taxes throughout the year across most of these guides. It’s because when you manage your financial information across the year, you get plenty of time to find different ways to reduce your tax bill.
Keep Your Personal Information Handy
No matter the type of tax planning software that you end up using for your tax filing, you need personal information to properly access and submit your returns. This includes your tax identification number (TIN), legal name, and other details that help the IRS identify you and your transactions without any confusion.
Put Your Financial Documents in One Place
Besides your personal information, you also need details referring to your bank accounts, assets, and investments to file your taxes properly. You can use a document organizer to keep this paperwork neatly in one place. Before tax season comes around, make sure to go through this stack and gather any documents that are still missing.
Decide How Do You Want to File Your Taxes
While many people face no trouble with filing their own taxes, others find it a little hard to go about this process all by themselves. Depending upon how comfortable you feel with handling your own financial reporting, you can decide if you want to hire someone or use an app by yourself to file your taxes.
Pick a Filing Status For Yourself
In case you move forward with filing your taxes yourself, you need to pick a filing status. This includes but is not limited to filing as a single individual, a married couple, and a head of household. Depending upon your household, you can choose a filing status that provides you with the most advantages.
Browse Through Applicable Deductions
When you file taxes, you can opt for standard deductions or itemized deductions to lower your overall taxable income. To make an informed decision, you need to determine the complexity of your transactions and how either of these options may benefit you. This also helps people with specialized skills like stylists and makeup artists figure out tax issues.
Learn About Tax Credits
While tax deductions help you reduce your taxable income, tax credits are a dollar-for-dollar amount that lower the taxes that you owe. You can benefit from various tax credits like the child tax credit and the residential clean energy credit. You can then invest this amount in a trading platform account to make the most out of your finances.
Don’t Wait Too Late to Submit Your Tax Return
Typically, the tax filing deadline for individuals falls in mid-April. But you don’t need to wait until the last day to submit your tax returns. In fact, the sooner you file your taxes, the better it is for you in terms of avoiding system issues and unwanted delays.
Pay Any Taxes That You Owe
Properly deducting withholding tax from employees’ paychecks is one of the biggest benefits of having a business accountant. But if you are a self-employed individual or freelancer, you may not have paid withholding taxes. This may cause you to have a noticeable tax bill that you should pay as soon as possible. Alternatively, you can work out a payment plan with the IRS.
Don’t Forget to Claim Your Refund
Tax bills are unavoidable for many people, but tax refunds can make it all better. If you have a tax refund, it typically shows up in your account a couple of days after your tax filing. You can choose to receive your refund in your account or through mail. From there, you can use that amount towards solutions like a wealth management platform to strengthen your finances.
With this checklist, you can turn the otherwise stressful tax filing process into a walk in the park. This helps you get through tax season without worrying about everything you need to do, every waking moment of your day.
