Friday, January 23, 2015

Tax Time Tips

Tax time is fast approaching. And while you are busy filing those tax returns, it is important to know whether or not you are getting the best refund possible. And unless you are trained in the matters, it is often hard if not impossible to know if you got the most out of your refund.

Do not fret! We have compiled a quick checklist you can use to help you make sure you have checked as many nooks and crannies of tax law as possible, to get the biggest refund possible!

1.     Some Basics: Organization is key to a smooth tax filing process. No matter what breaks you are eligible for, if you cannot find the information to prove you deserve the break, it will not matter. Take a day before you start your return just to put everything in order so you will know where to go for certain documents.
2.     Check your deductibles: Some of the biggest deductibles are being left on the table by most families, which result in giving up as much as $6200 in tax refunds. (For example, the most commonly unused tax credit is the Earned Income Tax Credit. This credit is designed for lower income households and can offer up to $6200 back in refunds based upon your eligibility. Another commonly unused credit is the Saver’s Credit. This deductible is for those who opened up a 401K or and IRA. This credit allows for up to $1000 in deductibles that would end up right back in your pocket—but you have to know to file for it.
3.     Consult a professional: While online companies are expanding with online tax returns, this is often the least effective way to get a good refund. While fast and easy, computers operate online tax programs. These programs take everyone through the exact same process, asking the exact same questions, and giving the exact same deductibles. Speaking with a person, however, you can fully share your year-in-review. You can go over specific events that could lead to deductions and it is possible through conversation, your accountant will find deductibles you qualify for. Let’s face it, the taxing process is one huge gray area of what applies/what does not apply, and computers were not made to operate in gray areas.
4.     Do your taxes early: Not only will finishing early get you a refund quicker, but it relieves the stress of doing taxes most people carry all the way until April. Stress is a silent hindrance that could negatively affect you in subconscious ways, so nip it in the bud and file early.

Filing taxes does not have to be an uphill battle. The best way to handle it is with a diligent hand and eye, along with someone to go back behind you to fill in the cracks you missed. You worked hard for your employer all year to earn that money, do not let the government take it without a fight!

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