If there’s one thing that people hate thinking about, it’s getting ready for tax season. However, filing taxes doesn’t have to be the usual hair-pulling hassle it usually is. Here to help you in preparing for tax season are four things you can do now to get started.
1. Get your paperwork in order. When you are preparing for tax season, keep in mind that you’ll need to bring your previous year’s return, your driver’s license or other ID, and your social security card. If your name has changed in the last year, maybe because you got married, apply for a new social security card now so that it reflects your new name by tax time. Returns often get rejected due to unproven name changes. Remember, you can easily find and download old bills from your Manilla account.
2. Decide: What is the best way to do your taxes — DIY or not? Filing yourself with the help of a program like TurboTax can save you money in the short term, but depending on how complicated your return is, and how much your time is worth, a CPA could save you more money overall. In general, it’s worth hiring a CPA if you have anything other than income as an employee and itemized deductions on Schedule A (taxes, home mortgage interest, etc.). Consider how complicated your return will be when decided the best way to do your taxes.
3. Talk to your teen. If you have a teenager who works and will be filing a return as well, make sure you find out whether he plans to claim himself as a dependent or not. Usually, he shouldn’t. It’s rare that a teenager makes enough money that he should be claiming himself, yet returns are often rejected because both the teenager and the parent have claimed the younger person as a dependent.
4. Be patient. When preparing for tax season, it’s tempting to try and beat the rush by filing your taxes early, but you should wait until every single form you need has arrived. This is especially true for anyone who works multiple jobs and will have several W-2s arriving in the mail. It will cost you more to do an amended return, so sit tight until everything arrives.
Taxes aren’t fun for anyone. But if you leave yourself enough time and start getting ready for tax season with these four steps, come April, filing will be a snap.