It is a new year and that means that it is once again tax season. Although filing taxes can be cumbersome, there are steps that you can do to make it easier. First, research tax credits and deductions for which you may be eligible. You can find information about everything tax related at www.irs.gov. It is important to understand what credits and deductions are available so that you can be sure to save as much money as possible or receive a larger refund. Be sure to do your research even if you pay a professional to prepare your taxes for you because he/she may not be as invested as you are in saving you money.
Second, get all your paperwork in order. Collect your W-2’s, 1099’s, receipts, etc. so that you have everything you need in one place before you begin working on your taxes.
Third, investigate which tax filing service may be best for you. There are a variety of electronic filing options that are free and some that are low cost. You may also qualify for free assistance from the IRS. You can check with your local library to see if they offer assistance. Or if you live near a university, see if the senior year accounting and business students prepare taxes for free or at a low cost.
Finally, start preparing for next year. If you are receiving a large refund or ended up owing money to the IRS, adjust your withholdings accordingly so next year you will not owe or be owed very much. If you had trouble finding all the necessary paperwork, create a folder or box to keep all your tax related paperwork in.
-Kathryn M.
Sage Personal Finance 