It is almost that time of year… tax season. But filing your taxes does not have to be all that dreadful when you master the basics. Firstly, understand that filing your taxes is a tedious process, but it is meant to benefit you- the taxpayer with that big tax return check later in the year. 

1. Document your income throughout the year

When filing a tax return, you must meet or surpass a certain level of income from all of your revenue sources including work, rental properties, interests, investments, etc. If you have more than one income, add up the total “year to date” amount on your pay stubs.

2. Don’t procrastinate

Stay on top of all your tax-related paperwork throughout the entire year. When this season comes around, you will be a much happier taxpayer. After you file important documents like work-related expenses, medical bills, loans, and other large costs, keep the paperwork in a file in case you must refer back to them. 

3. Be prepared for the tax documents to be delivered and respect the deadline

As tax season rolls around, your mailbox will start to be filled with paperwork on your income. Most popular, the W-2 form for full-time employment and the 1099-NEC form for freelance and contract workers. Study these forms and thoroughly read through the small text and details about all your income you earned. After receiving the documents, you are typically given a two-month timeframe to file and return the report on April 15-17. Do not allow yourself to pay easily avoidable late fees. Have the names, dates of birth, and social security numbers for yourself, spouse, and any dependents.

Pro Tip: The earlier you file, the better chances of avoiding tax-related theft. 

4. Research which credits and deductions are applicable to you

There are many credits and deductions that may apply to your financial situation and save you more money in the end. Saver’s credit is a reduction for someone who is not a full-time student yet is independent and contributes money to a retirement plan. Freelance expenses can be reduced for work-related expenses such as industry subscriptions and office-supplies. Check the IRS website for more information on qualifications. Your filing status (single, married, etc.) can affect your taxes greatly. 

5. Choose the best platform to file your taxes

Many taxpayers hire someone to do their taxes; however, there are simple self-sufficient ways to accomplish this. The IRS online forms offer different softwares and electronic versions of the paper documents to make filing your tax return convenient depending on your adjusted gross income. This way is more self-guided than other platforms. Tax preparation software is a platform that has a bit more professional guidance to walk you through the process for a fee. 

Be prepared for tax season to come anytime now. And remember… you got this!