The time to prepare for next year's tax season is now
For a large percentage of Americans, tax season is officially over. Many have already sent in payments to the Internal Revenue Service to cover their liability, while others are eagerly awaiting their refunds. Although the end of another tax season may be cause for celebration for many people who feel anxiety preparing their returns, this may be the perfect time to focus on next year's April deadline to make it easier on themselves.
There are several ways individuals can easily prepare for next year's filing deadline, and most of it starts with organizing tax records. Organizing personal information and gathering pertinent documents is often cited as the most significant headache during tax season. To avoid being forced to search around for a child's social security number or a receipt that may be needed to claim a deduction, take a day to gather all that information and lock it away in a filing cabinet or a safe, MoneyTalksNews suggests.
Individuals who organize their paperwork often only focus on physical documents. However, more individuals maintain information - such as invoices and financial statements - online, so it's crucial to organize digital content as well. Trying to weed through hundreds of saved documents that may have resulted over the course of a year can be just as frustrating as searching through mailed statements or paper documents.
Learn from this year's mistakes
Individuals can also learn from this year's tax season and use it as a guide to make changes for next year. For example, individuals who find that they overpay on their taxes and frequently get a large refund might consider adjusting their withholding. In doing so, they can ensure that they still get a small refund, but still keep more money in their wallets over the course of the year. For those who owed taxes this year, learning more about the ways to lower their liability can help possibly reduce the chances that they'll owe next year.
In addition to learning more about the credits and deductions for which they may qualify, speaking with a tax preparer about issues that may be affecting their liability is also important. For example, U.S. News and World Report notes that many people make last-minute contributions to their IRAs in order to both lower their taxable income and strengthen their retirement position. Other actions, such as increasing contributions to charities and selling losing investments may also help individuals keep their tax bills small.
For a more in-depth look at Liberty Tax Service, visit the Give Me Liberty! Magazine. Follow Liberty Tax on Facebook and on Twitter or contact Liberty Tax directly at 1-877-at-Liberty.