Tax season is here, and the deadline is quickly approaching. This year, tax day is April 15, 2021.
If you haven’t submitted yet, consider the four steps below to help simplify the process of filing your taxes.
1. Get Your Documents in Order
You might have elected to receive your tax documents electronically, or you could be working with old-school paperwork. Either way, the first step is to create some sort of system to collect and organize all of your tax documents. The system doesn’t need to be complicated – it can simply be a digital or physical file where you collect everything you’ll need when filing your taxes.
For federal taxes, check out this tax form checklist created by the IRS which lists out every document and piece of information you will likely need to file. In addition to documents that represent your income like your W-2, this checklist can also help you prepare for any income adjustments or credits you might be eligible for. If you plan to file for tax deductions for any expenses, keep in mind that you will also need to have receipts for those expenses at the ready when you file for taxes.
2. Choose a Tax Professional or Do-It-Yourself Option
If you plan to get outside help on your taxes, make an appointment with your tax preparer sooner rather than later to ensure you can get your taxes filed before the deadline. When setting up an appointment with your tax professional, be sure to have a conversation about your level of involvement. Some people prefer to just hand off all of their documents and have the professional do the rest, while others prefer to be more hands on.
If you prefer to file yourself, you might want to get your hands on some tax preparation software. Using a program like TurboTax, TaxSlayer, or H&R Block’s tax preparation software would be a good option if you want to be hands-on during the process but would still like a little guidance. These programs are designed to walk you the process step-by-step by asking simple questions and prompting you to upload the required documents.
3. Make Note of Any Changes
Every year can bring changes to tax regulations. Take a few minutes to make yourself aware of any changes that may affect you and your refund (or bill) for this tax year. Be sure to note any new filing requirements, which can be found on the IRS website.
Prior to filing, it’s also a good idea to reflect back on the previous year and make a list of any personal changes that might affect how you file. Any big milestones like buying a house, getting married, adding or losing dependents, or a change in employment should be noted. Depending on what personal changes occurred during the last year, do some quick research to educate yourself on the guidelines, possible deductions, or credits that you might be eligible for.
4. Decide How You Will File
Once you’re ready to file your taxes, you have the choice to do so electronically, or mail in paper forms. Last year, 92% of U.S. residents filed their taxes electronically. However, a recent NerdWallet study found that millennial taxpayers (aged 18-34) are more likely to use the paper option – 17% versus 8% of those who are 35 or older.
If you prefer a paper option, know that you’ll need to download the forms from the IRS website. Thanks to the popularity of electronic filing, the U.S. no longer mails paper tax forms automatically.
Are you prepared to file your taxes? What tools or tips do you use to make filing easier?
This information is not, nor should it be, considered tax advice. We recommend that you consult with your tax advisor or other tax professional regarding any tax matters.