8 Tax Tips to Help Navigate the New Year

Tax Planning iStock_000029873638XSmall

The new year is here. So much to think about and try to make happen in 2014. Don’t neglect your taxes and all the things you can do to be a more responsible and savvy tax filer.

Follow these tips to save money, time, and headache when dealing with your taxes in the new year.

1. Start a New Tax Records File – January is the perfect time to start a fresh tax file. A simple manilla folder will do, along with a new file on your computer to collect digital records. Place this folder next to where you collect your mail and be sure to stash all of your W2s, 1099s, and other year-end tax records.

2. Take Advantage of Extended Contribution Deadlines – 2013 is over, but that doesn’t mean you can’t still contribute to some tax-advantaged savings accounts. For instance, you have up until the time you file your taxes to contribute money to an IRA and Health Savings Account (HSA). Money contributed to a Traditional IRA or HSA is (for qualifying filers) deductible from your income and helps to reduce the overall 2013 tax burden.

3.  File Online – By filing your taxes online with TurboTax, you are able to quickly and accurately file your taxes yourself so you can get closer to your tax refund.  When you file online you can e-file your tax return.  E-file with direct deposit is the fastest way to receive your tax refund.  Plus when you file with TurboTax there’s no need to know the tax code.  TurboTax ask you simple questions about your life so you get the tax deductions and credits you’re eligible for giving you your biggest tax refund.

4. Expecting a Tax Refund? File Quickly – This tip seems like a no-brainer, but plenty of filers getting tax refunds wait too long to file. If you know you have money coming your way in the form of a tax refund, as soon as you have all of your information get your taxes filed. The quicker you do that, the quicker your refund will be in your hands.

5. Review Your Employer Withholding Amounts – The new year is a great time to review your W-4 and make sure it matches your current situation. Additional dependents, marriage, and other life events can have an impact on how your taxes should be withheld by your employer. TurboTax can help you figure out your correct withholding.

6. Make Your Last Estimated Payment Before January 15th – If you are responsible for paying your own taxes throughout the year (i.e. an employer doesn’t help you by withholding from your paycheck), then make your last estimated tax payment by January 15th.

7. Set Savings Goals Using New Contribution Limits – The IRS has already released the income and contribution limitations applied to various tax-advantaged savings accounts, like your 401K, IRA, or HSA. The new year is the perfect time to set up automatic savings deposits so that they help you reach the maximum contribution limits in these accounts.

8. Create a Year-End Reminder – Finally, be sure to set yourself a reminder to review your tax situation in the last quarter of 2014. Doing so will allow you to make the year-end tax moves that will have the biggest impact on your 2014 taxes.

Good luck navigating the new year!