Not many people enjoy the thought of having to do their income taxes, or needing to keep up with the daily receipts. But that doesn’t make it any less important. Tax season is right around the corner and the deadline will be here whether we like it or not. Here’s a few end of year tax tips, to help you get prepared and stay organized.
Gather all documents
Lots of things can happen during the year and it’s crazy to think we can keep track of it all. Now is a good time to start gathering up all your documents, receipts and statements. Look for papers like check stubs, donations receipts and insurance payments. You don’t have to thoroughly organize them now, just put them in a small box or folder for later. They will come in very useful when you need to verify all your tax figures.
Update your checkbook
So you haven’t balanced your checkbook in forever? That’s okay, now is a great time to start updating your account and inputting figures into software or online budgeting tools. It doesn’t take much time if sign up for free sites like Mint.com or Adaptu.com. The information is automatically important and divided into categories.
Pay last minute expenses
Before the end of the year you still have time to make any donations, pay a medical bill or squeeze in some last minute business expenses. Tally up all your job hunting expenses too, since these are tax deductible as well. Some of these expenses are only useful if you qualify for itemized deductions, but they can still be helpful in lowering your tax bill.
Make note of changes
Think over the past year and see if any big changes took place. Did you get married, have a child or move into a new house? Did you lose a job, did you have any theft loss or or did you experience a natural disaster? These are all situations that will affect your filing status or help you get a bigger refund when filing your taxes.
Taking a few minutes now, to start organizing your tax documents can save you money when it comes to tax season. The more work you do, the more accurate your return will be (ensuring a bigger refund or lower tax bill) and the less money you will have to pay someone else.
Next year will be my first year EVER doing taxes on my own. I’m terrified, but intrigued at the same time. I hope it’s not as hard as people make them out to be!
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