Getting the Most From Your Tax Return
Get every bit you can.
As tax season comes around, many are uncertain where to go to find help when filing taxes. With the array of tax-focused companies such as Turbotax, H&R Block, and FreeTaxUSA, there are plenty of options to consider turning to for tax return filing. Many of these companies, apps, and websites that have you submit certain data to calculate the best possible tax return you can get for what you made the prior are great resources for tax filing help. Not to mention, most of these companies have free 1040 and 1040ez filing programs. To save yourself some stress and hassle, there are a few things needed before beginning the process of filling out your tax return form. So you finish filling out your tax return with minimal stress, here are some simple tips to get you fully prepared for the process.
Get Your Documents Together
Put very straightforwardly, it is best to have all your documents long before you begin the process of filing your tax return. The first documentation you will need is your income documentation. One of the first things you will need to fill out on your W-2 form is a total of your income for the year. All employers that pay your salary are required to send you a W-2 form and generally do so around February when tax season is about to begin. It would be beneficial to get your pay stub or online pay stub throughout the year for help in getting a total income earned through the year. Your W-2 form will also have your tax exemptions for the year that you will need to enter into your tax return. Remember that if you are a worker that receives a 1099 form, you must pay estimated taxes on what you have earned. Primarily your W-2 and 1099, if you fall under this category, your employers will be the most important documentation to have, for you will not be able to give an accurate filing without them.
Find Professional Resources to Help
As mentioned, it is possible to file taxes without any professional help, and depending on your income history, it wouldn’t be too difficult of a task. However, to receive the best tax return, the benefits of hiring a tax professional outweigh the cost. The cost it will run you to hire a professional will vary, but generally it’s a small proportion of what you will be getting back from your tax return. However, if you are required to pay your taxes or simply don’t want to pay more than is necessary, there are options for free professional help. Along with free tax filing options from major tax-help companies, you can also find help from local universities. Accounting programs at certain universities offer free tax filing services for members of the community. You can also find resources online and how-to guides for filling out your forms. When paying your own estimated taxes, however, you must be careful with paying inaccurate amounts because you could be at risk of being audited and penalized, resulting in sometimes detrimental fees. There are options for tax audit protection that could help minimize the risk of penalties invoked from the IRS.
Take Into Consideration ALL Income
With the array of side hustles and opportunities around these days to make extra cash, many people forget to file for small amounts of income received through the year. Companies such as Doordash, Uber, and Grubhub are great opportunities for extra income, however, income from independent work such as this does not always exempt any taxes from you. Generally speaking, you are a private contractor working alongside the company, and thus required to withhold any taxes needed from income made. When tax season comes around, if you aren’t putting aside extra cash needed to pay your taxes, you could be left with quite a bit of money needed to pay. It may be beneficial to begin the process of finding out an estimate of how much money you would need to withhold from every paycheck, and begin the process of putting that money aside until tax season rolls around. With that money on hand, you’ll be saving yourself a sometimes huge financial burden that many people forget about when they need to pay their taxes.