What makes tax time so stressful that a lot of people procrastinate when it comes to taxes? Do you put them off until the last minute because you don't want to know what you owe the IRS? Or, do you put them off because you're unorganized? Regardless of why you put them off, I bet you're thinking about them a lot! You may even stay awake at night with visions of 1040's dancing in your head.
Why put yourself through all that stress? It's so unnecessary. We're going to use a basic tax deduction checklist to get your taxes organized, filed, and off to the IRS quickly.
In fact, if you follow these steps, by this time next year your taxes will already being done! Yes, just imagine, they're in your accountant's hot little hands or you've already completed them yourself at your computer!
Hip Hip hooray! I hear you cheering right now. So, let's get those taxes organized fast.
First: The information you'll need for filing your personal income taxes is based on your individual circumstances but, here's a basic tax deduction checklist you can use to start with. Don't worry; we'll supplement it in the following steps to capture any additional deductions:
- W-2's for you and your spouse
- Social security numbers for you and your dependents
- If you were an independent contractor and made at least $600 in the prior year, you'll need your 1099 form(s)
- All brokerage statements from stocks, mutual fund accounts, and other investments except IRA's and 401k's
- Your mortgage interest and property tax statements
- The closing statements for real estate bought or sold
- Expenses related to college for you or your dependent(s)
- Any charitable donations made
- Any child care payments made
- Any alimony paid or received
- Any union dues and or professional association fees paid
Okay, as I said before this is a basic tax deduction checklist. Another great way to organize your taxes while saving time is to look at last year's return. Looking at last year's return, will enable you to see what deductions you took. Then ask yourself what has changed in your life over the past year and update your checklist accordingly.
Third: To make sure you've captured all of your deductions - check out TurboTax's tax preparation checklist. Print out this excellent tax preparation checklist to help you further identify possible deductions and information you need to organize and file your taxes. Again, remember to update your checklist with any additional information you find.
Fourth: Once your taxes are done, filed, and off to the IRS we're going to organize your taxes for next year. No, I'm not kidding. Why wouldn't you want to simplify your life now by organizing your income tax records for next year?
To do this, grab that tax deduction checklist you've been updating all along and create a central location to capture all of your income tax records information as they come in throughout the year.
What is a central location? Well, it could be anything you want it to be as long as it's easy to use (readily available) and safe and secure (won't get lost, misplaced, or destroyed by the kids).
A central location can be a simple file labeled "TAXES", a shoe box, an accordion file, and even a bread box just as long as you use it and keep your checklist handy. Then as income tax related documents come in throughout the year, simply check them off your tax deduction checklist, and file away in your central location. That's it!
To recap, here are the simple steps to organize your taxes now and for next year:
First - Use the basic tax deduction checklist provided above.
Second - Supplement this checklist with information from last year's return.
Third - Check out TurboTax's extensive tax preparation checklist and update your tax check list accordingly.
Fourth - And, for next year, create a central location to capture income tax records throughout the year. And, be sure to use your personalized tax deduction checklist to keep track of tax information as you receive it.
Tis the season for taxes! Samantha Buck is a Professional Organizer and offers tips to make tax time a breeze at http://www.lifeorganizeit.com/income-tax-records.html Be sure to check out her site where you will find solutions to life's organizing dilemmas by subscribing to the free organizing magazine "Organize It Mom!" at http://www.lifeorganizeit.com/free-e-zine.html for super easy tips and techniques to get yourself organized. Not just for moms, this free organizing magazine will help anyone get organized!