When we started filing our taxes, it felt overwhelming. However each year we try to learn and adjust our system, especially since I’m self-employed. It’s not a cake walk, but we feel more prepared and confident getting our taxes done.
Autumn just began, but if you haven’t already, now is a smart time to get your stuff ready for filing your taxes! Since things are slow tax-wise, you can brush up some things and take the time to get your documents in order without the crunch of tax time.
Looking to make filing taxes easier? Here are tips to smooth out the process now and later.
Know what to expect. Sometimes the unknown is scarier than the actual thing. It can be the same way with taxes. Having the right paperwork in front of you makes it much easier (and more accurate) when you file. Not sure what you need? Don’t worry, TurboTax will walk you through what you need, ask you simple questions, and give you the tax deductions and credits you are eligible for based on your entries.
Have a regular system for your taxes. As an entrepreneur, I learned that I can save myself a lot of time by staying on top on finances little by little. Waiting once a year, or even once a quarter may give you a migraine, so do yourself a favor and have more frequent updates.
Sylvia Inks, author of Small Business Finance for the Busy Entrepreneur, suggests scheduling time each week to review your finances. This helps avoid forgetting or losing receipts that we need to claim certain deductions. A quick review and tidying up your records can pay dividends at tax time.
To make this process easier, QuickBooks Self-Employed helps you track your business income, expenses, mileage, and capture your receipts all year long. You can then export your information directly to TurboTax at tax-time.
Keep Human Resources updated. Have you had a recent change in your life, like a new baby or move? Go ahead and let your Human Resources representative know. The wrong address can delay important documents reaching you and not updating your W-4 can mean not maximizing your tax refund potential.
Go over your investments. Are you taking advantage of your financial situation before the year ends? If you have losing stocks you can sell them and offset your capital losses against your capital gains. You also may want to look at maxing out your retirement. For 2017 you can contribute $18,000 ($24,000 if 50 or older) to your 401K and reduce your taxable income at the same time. If you are self-employed you can contribute up to the lesser of $54,000 or 25% of your compensation for 2017.
Estimate your tax situation and make last-minute moves. You can get an idea of where you stand and make some last minute tax moves by using TurboTax TaxCaster. With TurboTax TaxCaster you can get an estimate of your tax liability, and make some last minute tax moves to lower it. For example, donating to charity or purchasing that computer equipment for your business before year-end can help lower your tax liability.
Try to make some time over the next week or so to get things together. You’ll be so much happier now and later!
We’d love to hear from you. What tips do you have to make taxes easier? How do you organize things?