Tax Season-Dont Dread The Start Of The New Year

Tax Season-Dont Dread The Start Of The New Year

Tax season is just around the corner and even though we all know it is coming every year, we still dread it…every year. With the yearly changes in the tax codes and everything just getting more and more complicated it is no wonder every one is stressed to the hilt this time of year.

Tax season starts on January 1st and runs through midnight on April 15th, normally. Last year though, the 15th landed on Good Friday and so the government gave everybody until midnight on the 18th to file their taxes.

If you have never filed taxes before, you should receive your W-2 from your employer by January 31st. If for some reason you do not get it by then, just call your employer and have them resend it. Then when you get it you can file your taxes. In any instance that you never receive your W-2 you can file your taxes using your last pay stub of the year so hang onto that one. There will be an additional form to fill out as well so it may take a little longer but it will work.

If you have other forms of income they need to be documented as well. Lottery winnings or any other winnings, like casino gambling, or other sweepstakes is all taxable income. Alimony payments and retirement savings like an IRA are also considered taxable income.

If you have kept accurate records throughout the year you should not have too stressful a time filing this year. Organization is key to knowing where everything is that you need when you need it. For things like mileage to and from work, you should keep a notepad in your car and be documenting every single mile you drive for work. This is the only proof you need to back up your claim of miles driven.

Make sure that you can document or back up every deduction you claim. It really doesn’t matter how many you have but if you go from one or two to ten or twelve the IRS will take notice and they will audit you. When they do this you must be able to back up what you have claimed otherwise they will penalize you with fines and may even charge you with fraud. Do not be stupid and get yourself thrown in jail. Cheating on your taxes is not worth it.

That said, do make sure that you get all the deductions that you have coming to you. Deductions are the things that get deducted from you total taxable income and this is how you arrive at the adjusted gross income number at the bottom of the filing page. The more deductions you have the less income you will be taxed on.

Then you have to figure your credits, this will also reduce the amount you are taxed on. Some credits you may be eligible for are the child care credit, earned income credit, and possibly credits for being a first time home buyer or if you bought a new car recently.

Talk to your tax professional to see that you get whatever it is that is coming to you in the form of a refund on your return this tax season.