Save Tax-Time-Stress with this Easy Checklist
‘Tis the season . . . to get ready to do your taxes.
No, really.
That may sound crazy – it’s early November, after all. You haven’t even finalized your Thanksgiving menu. You’re still trying to sort out holiday travel plans. You won’t even get your W-2 until January. Why worry about taxes now?
Because if you’re like most folks, the span of time between Thanksgiving and New Year’s Eve is going to be a bright, shiny blur of decorations, food, shopping, and parties. Taxes will be the last thing on your mind. And that means that, when tax time does roll around in mid-January, you may not be be as prepared as you could be.
I don’t know about you, but I prefer to keep income taxes as stress-free as possible. One way to do that is to take a little time to prepare for tax time – before the hectic holiday rush takes over.
Want to get a pre-holiday head start on your taxes? Here’s a checklist of things you can do today to make tax season a breeze:
- Gather up your receipts. Do you claim business expenses on your taxes? One way to get ahead is to gather up all of the receipts for items that you plan to claim on your taxes. Review them, and put them all in one place so they’re easy to access when the time comes. Want to really get ahead? Circle the amounts on each receipt to make them easier to see. Have a few minutes to spare? Add up your expenses and get a preliminary total (you should re-check your math at tax time, though).
- Get credit for giving back. Did you make any charitable contributions this year? Donations of money and items such as clothing are tax-deductible, if you have proof. Make a list of all the charitable contributions you’ve made in 2015, and take the time to track down receipts for anything you want to write off. Put them all in one place so they’re ready for tax day (envelopes are a great way to keep track of receipts).
- Get credit for going green. Did you make any eco-friendly home improvements this year? You can earn tax credits for some kinds of improvements – such as purchasing energy-efficient appliances, buying an electric or hybrid car, or using green building materials. Not sure if you made a qualifying purchase? Want more information about the types of tax credits available? Check out this tax credit list on the IRS’ website. Keep in mind that you’ll have to have documentation (such as a receipt) to get the tax credit!
Of course, making energy-efficient improvements aren’t the only way to earn tax credits, and this leads me to the next item on the checklist . . .
- Check for other credits and deductions. From adopting a baby, to going to college, to moving, to working from home, there are lots of tax deductions out there. Not sure which ones, if any, you might qualify for? Browse this guide to find out.
- Think about how you’re going to do your taxes. If your finances are on the complicated side, you might want to consult a tax-prep pro – and if you haven’t started your search, start now so you have time to find one that you trust. If your situation is simple and straightforward, you can probably take the DIY route and file online. If that’s the case, consider your options: You can get free tax-prep tools online or you can buy software that will walk you through the process.
- Have a family? Have their info handy. If you plan on claiming kids or other dependents on your 2015 taxes, you’ll need to make sure you know their birthdates and Social Security numbers. Chances are good you don’t have that info committed to memory – and you don’t want to have to hunt for it at the last minute. And if you added any new additions to your family this year, make sure they have Social Security numbers!
- Start a filing system. Now that you’ve got all of your receipts and documents ready to go, you’ll need a place to store everything until tax time comes around. The options are limitless: File them in folders, stuff them into envelopes, or stack them in shoeboxes – whatever works best for you. The only thing that matters is that everything is ready to go when you need it.
See? Nothing too complicated. Probably a half-day’s work at the most – but you’ll be glad you did it when the time comes.
And if you need debt advice or have questions about spending, saving, budgeting, or credit cards, you can always reach out to Debt Guru. Contact the Debt Guru team today for a free debt consultation.