The arrival of spring should be a time for celebration but for many Americans, March brings anxiety as they prepare for tax season. Approximately 150 million Americans1 will file individual tax returns this year and some of them will leave it till the last two weeks before the deadline. Many people are overwhelmed by preparing tax returns and some are so fearful that they avoid it altogether.
But it doesn’t have to be that way. Follow these simple tips for a stress-free tax season:
Avoid fear of filing – People fail to file tax returns due to procrastination, lost documents or a fear that they will owe money. While these concerns are understandable, you can’t get your financial house in order unless you know where you stand. There could be a refund waiting for you and even if you owe money, there are payment options open to you. Regardless of the outcome, filing your taxes on time will not only shorten your to-do list, it will help you plan for the future.
Start as early as possible – The deadline for filing individual tax returns is usually mid-April so set aside some time in the weeks before to organize your paperwork, make sure you have all the necessary forms, learn about any changes that may affect you and get copies of any missing documents. Finally, schedule at least a half-day in your calendar when you know you can complete the return without interruption.
Get your documents in order – Make a list of everything you need to complete your tax return including W-2 forms, charitable receipts, investment income statements, childcare invoices, freelance income, etc. Then, prepare one document with any other important information you’ll need to complete the form such as social security numbers, mortgage interest amounts, etc.
Use the correct form – There are a few forms to choose from when preparing your taxes. The 1040A form is the simplest and shortest one but, depending on your circumstances, it may not be the right one for you. To find out which form you can use, visit irs.gov.
Double-check your information – It’s not surprising that some people make mistakes with math calculations but many tax returns are rejected because people forget to sign their names or have typos in their personal information. The information on your tax return must match what the Internal Revenue Service (IRS) has on file for you. Once you have completed the return, set it aside for a day or two and then review it with fresh eyes or have someone else proofread it. Copy everything before you send it off.
Consider filing electronically – It has never been easier to file your taxes online and there are many benefits of using this option. Not only is it faster and more convenient but you will also receive a confirmation that the IRS has received it within 24 hours. If there is a problem with your return, you will also find out how to fix it sooner. And, most importantly, if you’re eligible for a refund, you will receive it earlier. For more details, visit http://www.irs.gov/Filing.
Get help – Working with a professional can ease your tax preparation burden but, depending on your circumstances, it may not be affordable or even necessary to go this route. The IRS Volunteer Income Tax Assistance (VITA) and the Tax Counseling for the Elderly (TCE) Programs offer free tax help for taxpayers who qualify. And to help keep finances in order throughout the year, Foresters™ members can connect with Everyday Money for help with financial questions about budgeting, saving and dealing with debt. Visit foresters.com for more information.
Preparing and filing your income tax return can be time-consuming, but it’s also a valuable opportunity to review a year’s worth of finances and make informed financial decisions for the following year.
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Foresters, their employees, life insurance representatives and Everyday Money counselors, do not provide, on Foresters behalf, legal or tax advice. Consumers should consult their tax or legal advisor regarding their specific situation.