Tax season is right around the corner, and if you want to make sure you file your taxes on time and accurately, now is the time to start getting ready. Here are some steps you can take to make the process smoother and easier.
Gather Your Documents
The first step in preparing for tax season is gathering all of the relevant documents that you will need when filing your taxes. That includes any W-2 forms, 1099 forms, bank statements, investment statements, receipts for deductible expenses, or other forms that detail how much money you made throughout the year. You should also gather documents related to any deductions or credits you plan to claim on your return, such as charitable donations and medical expenses. It’s also a good idea to make copies of these documents in case you need them later down the road.
Determine Your Tax Filing Status
Once you have all of your documents together, it’s important to understand what filing status best applies to your situation. Your tax filing status determines how much income is taxable and which deductions or credits are applicable based on your current situation. It is important to be aware of what your status is so that you don’t miss out on any incentives or credits available to you as a taxpayer. Consider factors such as age, marital status, dependents, and income when determining which filing status applies best for you this tax season.
Review Last Year’s Return
It’s always helpful to review last year’s return to remind yourself what information you included in the previous year’s tax filing. This process will help you identify any potential changes that may have occurred over the past year such as job changes and investments. Checking last year’s return can also help with the accuracy and verification of records when filing this year’s taxes.
Start Planning Early
Finally, one of the best ways to prepare for tax season is by starting early. Sit down with an HBI tax advisor, so we can help guide you through what changes you may need to make in order for you to optimize your returns while staying in compliance with federal and state regulations.
Preparing for tax season doesn’t have to be a stressful experience; in fact, it can actually be quite simple if done properly! By gathering all relevant documents ahead of time, understanding which filing status applies best to your situation, and consulting with our team early on in the year, filing taxes doesn’t have to seem like such an overwhelming task come April. With a little bit of preparation now, tax season doesn’t have to be stressful later on.
