With tax season officially in full swing, there’s no better time than the present to start learning about the do’s and don’ts of tax filing. Whether you’re a veteran tax filer, or undergoing your very first year of taxpaying, there are certain do’s and don’ts that are universally beneficial to familiarize yourself with. Simply put, the more that you can learn, the better prepared you’ll be, which is why in this blog post, we’re going to tell you what to do and what not to do, in order to help you sail smoothly through tax season. Here are some of our quintessential do’s and don’ts for tax filing, to consider both presently, and in future tax years.
Do: File Early
In the world of taxes, timing is everything, and filing after the federal deadline can land you in hot water. On the contrary, filing early can help you circumvent a lot of potential challenges like helping you to avoid tax-preparer scams, and prevent having your refund stolen. Plus, filing ahead of time allows you to help ease the pressure of a looming deadline. And as we all probably know by now; pressure and stress can often make us sloppy and vulnerable to making careless mistakes.
Don’t: File Late
Don’t file late, it seems like a given, right? Well, even so, every year a handful of tax filers push their limits and wait till the last minute to file which is often a recipe for disaster. Tax season is costly as is, and the last thing you want to do is miss out on more money because you got dinged with late fees. Moreover, late fees can also be compounded by interest, making it quite easy for your fees to increase exponentially. To avoid penalties, make sure you file your taxes on time. If you’re worried you might miss the deadline, do yourself a favor and request an extension instead.
Do: Get Organized
By nature, tax filing requires compiling a lot of documentation and sifting through endless paperwork. As a result, getting organized is one of your best defenses against losing important paperwork and easily finding necessary documentation. Part of getting organized also includes keeping good records. Not only will you feel infinitely less stress knowing you can easily access the important documents, but you’ll be able to file much more effectively.
Don’t: Omit or Withhold Income
When losing money to taxes, it can be tempting to try and preserve as much of your funds as possible. Whether done in an intentional or accidental manner, withholding income is a surefire way to welcome a host of problems into your life. A lot of people will actually withhold a certain portion of income because they don’t believe it to be taxable. However, it is always better to be safe than sorry, especially when dealing with the IRS. If you think there’s any chance a part of your income could be potentially taxable, put it in your return. Commonly withheld income includes rental properties, investments and money from side gigs. Remember to keep in mind that failure to report taxable income will result in penalties from the IRS, including hefty fines.
Do: Deduct Eligible Medical Expenses and Charitable Expenses
One of the silver linings of tax filing is undoubtedly deductions. And yet, a surprising number of people don’t realize that they may be sitting on a host of potential deductions. There are actually a surprising number of potential deductions you may be eligible for, and these often derive from medical and charitable expenses. The qualifications may change depending on the year, but if you meet the criteria, make sure you take advantage of deductions, as they can save you a pretty penny.
Don’t: Forget to Sign Your Tax Form
Failing to sign your tax form is one little mistake that can cost you big time. Double check that you have signed all necessary tax forms and documents prior to submission. A review will not only help you verify that you’ve signed your documentation but also help you catch other common mistakes. It can also help you avoid time setbacks, as an unsigned tax document can delay the processing of your return, and possible refunds too.
Do: Consider Filing Online
Technology has revolutionized the way that we do our taxes, and being able to electronically file is one of them. Filing online can help save you time and money, especially if you utilize certain programming like Turbo Tax or Credit Karma. E-filing is a way to file taxes in a cheaper, more organized, and accurate manner. You can also receive your tax refund sooner when you file electronically.
Don’t: Share Your Tax Information with Unverified Contacts
While technology has greatly improved tax filing for most people, technology does have its downsides, and one of them is scammers. As tech has become more sophisticated, so have the scammers that utilize it to prey on vulnerable filers. Furthermore, scams ramp up during tax season, and can be difficult to flag. Make sure that you never give any sensitive information out to unverified contacts. As a rule of thumb, the IRS will communicate with most people through snail mail, especially when initiating contact. Keep this in mind to help you protect yourself against scammers. Also remember that while the IRS may subsequently contact you through the phone or a home visit, they do not correspond through email. Ergo, never give out any information to people claiming to be the IRS over email. If you have any questions about the validity of a message claiming to be from the IRS, you can always reach out to the IRS directly and they will confirm that they’ve contacted you.
Do: Hire a Professional
While it’s true that technology has made filing taxes a lot easier, sometimes the best way forward is to work with a reputable professional who has the experience necessary to ensure your documents are safe, accurate, and compliant. Professionals can help any tax filer, expert or novice, as they navigate the challenges of tax season. A pro takes care of things for you, giving you both peace of mind and more time to focus on other important tasks in your life.
If you are local to the greater Charlotte NC area look no further than McGrant Tax & Bookkeeping. As a business that has been successfully operating for more than 27 years, we have established ourselves as a firm that Charlotte’s personal and professional tax filers have trusted and relied on for decades. To learn more about the ways that we can help you with tax preparation services in Charlotte NC, feel free to contact us today at any of our two locations or visit our website https://mcgranttax.com and book an online or physical appointment.
This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her attorney, business advisor, or tax advisor concerning matters referenced in this post. McGrant Tax and Bookkeeping assumes no liability for actions taken in reliance upon the information contained herein.
