Tax season has come and gone, but staying on top of finances and keeping organized for next year’s tax return is an ongoing process. So, every year around this time I start to do some spring cleaning with my financial papers. I’ve learned a lot from financial experts that I have found very useful; so here are my top 7 tips for staying organized for next year’s tax return:
- Create a tax file for next year
Make sure you and your family put all tax papers in one place for next year. This way you’ll avoid the search for important tax papers next year and it will make it much easier to prepare your taxes.
- Make sure your account information is accurate
If you used an online tax preparation solution like ezTaxReturn.com this year, double check your address, social security number and all other vital information is correct. This information may be carried over from this year into next year’s tax return.
- Put your tax return file where you can easily find it next year
Did you download, print and put your tax return and supporting files with your other important tax papers? You may need it if you apply for a home loan or financial aid.
- Take action when life changes occur
Things like buying a home, change in marital status and the birth of a child can change how much tax is taken out of your earned income. If that happens, make sure you file a new Form W-4, Employee’s Withholding Allowance Certificate, with your employer.
- Think about itemizing
If you usually take a standard deduction you might be able to lower your taxes if you keep track of your expenses and itemize your deductions instead. If you own your home, the interest you pay on your mortgage is deductible. So are taxes you pay on real estate.Of course charitable donations are tax deductible, too.
- Use your phone’s camera
Every smartphone and many feature phones have a camera. So when you need to track where your money goes, take a picture of the receipt. This way you don’t have a stack of receipts lying around waiting to get put into the tax file. When you get a chance, just move the picture file into a different folder on your phone or download them to your computer.
- Keep up with changes
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Just keep in mind that a little planning and organization now can pay off when you prepare your tax return next year.