6 Steps to Stress-Free Tax Filing in 2016


6 Steps to Stress-Free Tax Filing in 2016

Posted by Infinite Wealth Advisors, LLC
9 years ago | May 4, 2015

Accounting Series - Senior WomanIf you’re like millions of other Americans, you filed your federal income taxes last month. Now, you feel as though you need a month-long vacation to recover from the trauma. If you’re tired of the shock and exhaustion that tax season seems to bring to your life each spring, there is another way to deal with the hassle of taxes. Take these six steps throughout 2015, and filing your taxes will be easier than ever next April.

Choose a better record-keeping system. Don’t toss bank statements and receipts into random drawers or the bottom of your purse. For most people, one of the most time-consuming processes of tax filing is locating old documents. Scan them and upload into an online storage system, or file them according to type of document and lock them away. It doesn’t matter which type of system you use, as long as you commit to using it throughout the year.

Keep track of charitable contributions. Charitable giving may comprise one of your largest tax deductions, and yet many people fail to properly document and store records of their contributions. Create a separate file for these receipts in your storage system. Also, rather than giving randomly throughout the year, decide upon a charity budget early in the year. Write one large check at the end of the year, or set a schedule for giving. This will make it easier to track your deductions and gather proof when it’s time to file your taxes.

Get in touch with your accountant. Your accountant is swamped with work each April, and then his clients seem to forget he exists throughout the rest of the year. The best time to call your accountant with questions is not the evening of April 14, but in slow months when he has more time to give you advice specific to your tax situation. Keep in touch during the “off” months, too.

Access old records. You never know when you might need to download a copy of your old tax records. But doing it during April is a fool’s errand, considering the IRS website becomes overloaded and tends to run slowly or crash during that time. Set up an account on IRS.gov sometime this year, and you will have peace of mind knowing you can access your old records when you need them.

Adjust your retirement plan. Saving for retirement can carry valuable tax advantages, but only if you plan well. The time for adjusting your retirement plan is not the night before you complete your tax return! Make the appropriate adjustments now, and you will have fewer last-minute tasks to accomplish next spring.

Start paying now. Do you find yourself writing a large check every year when you file your taxes? If you know you’re going to owe the IRS, adjust your paycheck withholding now. If you’re self-employed, talk to your accountant about setting up quarterly tax payments, so that you aren’t surprised with a larger-than-expected tax bill next April.

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