4 Tips for Filing Your Taxes
Many Americans are familiar with the overwhelming struggle and stress that tax season brings. There’s paperwork to keep track of, numbers to crunch, and strategy involved in paying your contributions to the IRS. To help relieve some of the woes tax season brings, we have 4 tips to help you file your taxes properly this year. Don’t let another season of tariffs and turmoil go by until you’ve read this guide.
1. Early is On Time and On Time is Late
You’ve probably heard this one before — and this motto definitely rings true when tax season rolls around. So follow these words of wisdom before the tax deadline passes you by. It’s easy to “forget” or avoid paying your taxes in a timely measure. But waiting until the last minute to file your taxes could end up being a costly mistake if you end up missing a deadline. The IRS is known for their appreciation for punctuality, and here are some of the penalties you may be hit with if you fail to file your taxes:
- A longer wait to receive your tax return
- Failure to File (FTF) penalty 5% per month or partial month up to 25% maximum
- Failure to File (FTF) penalty 0.5% per month or partial month up to 25% maximum
When dealing with the IRS or any other hard deadlines on your calendar, it’s best to use a time-management tool to help you keep track of your important dates and priorities. Set periodic reminders for yourself to file your taxes step-by-step. Use this as a guide to help you prioritize your tax-related tasks:
- Step One: Gather your W2s, receipts from charitable donations, and any other tax forms you may need to file.
- Step Two: Find a tax professional or file on your own.
- Step Three: Check your filing status.
Creating a to-do list can make filing taxes a more manageable process and alleviate the stress of having to get everything done at once! If you have trouble keeping your tax forms organized, invest in a custom notebook to jot down your notes and solve equations and a set of decorative folders to hold onto your tax forms each season. Make sure you have electronic backup by using a cloud-based storage system like Dropbox to keep copies of your electronic files.
2. No Taxpayer is Perfect…But They Do Get Second Chances
Filing taxes is a task that most Americans dread when tax season comes around every spring. Since it can be such a complex process depending on your filing status, it’s inevitable that taxpayers are going to make some errors on their tax return paperwork. If you have found a mistake on your tax return, make sure to file an amended return with the IRS using Form 1040X. Take note that the tax return amendment process is not immediate and it can take up to 3 weeks before your new return is recognized in the IRS system. If it’s been a few weeks and you’re still wondering, “Where’s my amended return?” — you can use the IRS’ tool to check the status of your amended return. The IRS says taxpayers must file their amended tax return within three years of the original file date in order to claim an updated tax return.
3. Know When to Call in a Professional
Whether or not you consider yourself a “math person,” plenty of people hire a tax professional to help them file their taxes. With the help of an expert, you can ensure you’re filing your taxes correctly and with a filing strategy in mind. Plus, hiring someone else to take on your complicated tax paperwork can free up some time on your end!
4. Prepare for Tax Season Ahead of Time
Organization is the key to success in tax season! Staying on top of your finances year-round will make filing in the future a whole lot easier. Luckily, there are plenty of apps and old-school resources to help you prepare to file next year. Use Shoeboxed to keep your receipts in order and use IRS2Go for more tips and to check in on your status!
Whether you decide to hire a professional tax preparer or go it alone this tax season, just remember to stay organized, punctual, and follow these tips to make sure you file properly.