• Kadia Laventure

It's Tax Time

A new year has come. Woohoo, how exciting. The champagne flowed, the resolutions and vision boards were created. The celebrations have ended, and then you realize it's also time to do your taxes. For some people this time is very stressful. However with a little preparation, you can make this a very stress free situation. Here are some tips to help make your tax time go more smoothly

Start Early

We all know we have until April 15 to file our taxes, without needing to request an extension. If you compile the documents you need early, you should be able to get your taxes done with plenty of time to spare. Honestly it's best to compile your documents as you go along through the year, so there isn't a mad rush to find what you need at the end of the year. Have designated folders for personal information, deductible items, investments and expenses. Also file copies of previous tax returns. This will help prevent some of the chaos in finding your documents when you need it.

Keep a folder for each member of your family with all their personal information/relevant tax documents such as social security cards, copies of ID cards and school information for the kids. It will be easy to grab come tax time.

Since I handle donations for clients. I encourage them to keep all receipts to charitable organizations together. Dont forget to write what the donation was for, and the value if the items as soon as they are dropped off. Trying to remember this information at the end of the year can be mayhem. Feel free to scan these receipts or register items online. Missing a receipt? Salvation Army has downloadable receipt you can access

here

and you can access Goodwill's receipts

here

Digitize it

Store as many items as you can digitally in a cloud storage such as

Google Drive

or

Dropbox

. Apps like

Expensify

or

Smart Reciepts

allows you to scan receipts and create expense reports too. Electronically stored documents are easier to share with your accountant or to upload when it comes time to do your taxes.

Storing items electronically also alleviates much of your paper clutter. Many legal and tax professionals advise that you store your returns and related documents for at least 7 years. But that can get overwhelming quickly. Scanning and storing documents, allows you to keep documents for 7 years or more quite easily. Create a Binder

If you choose not to store and share your documents electronically, then create a binder of all related documents before your begin your filing. While each individual's filing requirements are different, here are a few common items you will need when filing. Prior Year Tax Return Copies Personal & Dependent Information Banking Information (if you plan to do direct deposit of your refund) Income Statements Itemized Deductions Retirement Fund Education Expenses Health Care Your tax professional will advise you on what else you may need for your personal situation. Make a plan If you are expecting a tax refund, make sure you have a plan on how you will use or save it. If you expect to pay, ensure you have your expected payment information on hand when its filing time. For more information on keeping your documents in order, check out these record keeping tips from the IRS.

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