Would you like to make filing taxes just a little bit easier?
Whether you pay a preparer or prepare your own taxes there are some steps you can take to make filing your taxes just a little bit easier.
My story
Every year, I prepare my mother-in-law’s taxes. Her taxes are relatively simple and easy to file online.
However, every year, without fail, I am fumbling around trying to find/remember all the pertinent information that is necessary to file her taxes.
One year, at the very last minute, as I was finishing up, I realized that one crucial document, the main 1099-R (retirement earnings) was missing.
Filing her taxes was abruptly aborted and instead I rushed to get an extension filed before the deadline.
A little bit of advance preparation could have avoided a lot of stress and a delayed refund.
Filing taxes will probably never be classified as fun by most of us. However, with a tiny bit of advance preparation filing taxes will be a little bit easier.
Make filing taxes easier-things you can do
Secure all tax related documents as they arrive, whether by mail or electronic means.
Documents will begin arriving in early January.
By law, tax documents are due in the mail to the filer by January 31st.
Have a plan of where the documents will be kept until they are needed.
The tool of choice for me is the ever-faithful manila file folder.
Label the folder simply, taxes, and add the year.
Immediately, as tax documents begin arriving or are downloaded, put them in the file folder.
Resist the impulse to keep tax documents with your other mail. They can and will get lost and overlooked when you begin to prepare your taxes.
Create a cheat sheet of all personal information necessary to file taxes.
Your cheat sheet should contain the full names, social security numbers and birthdates of all filers and dependents.
If you typically get a refund, and it is direct deposited, include a record of your bank routing and account numbers.
Take a quick minute to ensure your banking information is correct.
Life situations change and with them, banking information.
Divorce happens and the last thing you want is for your refund to land in the account of your ex-spouse. Because good luck in getting it back.
Keeping a cheat sheet with all personal information is a time saver and it is actually amazing how many times, in addition to tax time, you will need this information.
Include a copy of last year’s tax return in your file folder.
You may or may not need a copy of last year’s tax return.
Have it on hand and avoid a last-minute scavenger hunt.
Keep a list of documents that you think you should receive and check them off as they arrive.
This list will change from year to year, depending on your circumstances, so take the time to keep it up to date.
If there was a document you needed last year, chances are, you will need it this year.
Maintaining a comprehensive, updated list ensures that nothing is missed when you file your taxes. (You know, like the main tax document 🤦♀️)
You may think that your situation is simple and the only thing you need to be concerned about receiving is your W-2.
This may or may not be true. I am amazed at how many tax documents can be delivered to the most very simple tax filer.
Did you receive unemployment for any part of the year? You will get a form for that.
Did you attend college? Again, there’s a form for that.
Did you do some work on the side? Guess what, there’s probably a form for that.
Get the picture? You may have more forms coming than you think.
Do yourself a favor. Keep a list.
The last thing with which you want to deal is filing an amended tax return because documents arrived after you filed your taxes.
Do you itemize?
If you itemize your deductions, gather all supporting documentation and put it in your file folder.
Do you have a small business?
Creating a tax filing process for those who run a small business is going to be much more in depth than the scope of this post.
However, the concept is the same.
Gather all supporting documentation that will be necessary to claim your deductions and have it available in your file folder.
My suggestion would be to have a separate file folder/folders for your small business.
Don’t file too early.
One word of caution, don’t file too early. Everyone wants to get a jump on their anticipated refund. However, filing too early can result in missed information, which, in turn, requires you to file an amendment.
The earliest I would consider filing is mid February. That gives all incoming documents time to arrive.
Tax filing is never going to be considered one of those fun annual activities.
However, investing just a small amount of time before you prepare your taxes can certainly make filing taxes a little bit easier
updated 01/25/2025
********************
TAKE ACTION!!!
Check out Micki’s Little Letter
Comments or questions? Email me at Micki@LivingbyLittles.com
Like It? Share It! It’s a little thing that means a lot to me!
********************
Love the wrapping paper hack!
Thanks! (Lynn is referring to the hack which was included in the newsletter that goes out to subscribers 😊)