A little preparation will make tax season less taxing this year!
It has been said that this is the most wonderful time of the year! While I would have to agree with that sentiment, I would also have to acknowledge that it can be the most stressful time of the year for many taxpayers too!
However, there are steps that you can take to make tax time less taxing and stressful this year as follows:
- Make a folder labeled “2021 Tax Information” to gather all of your tax documents as you receive them so that they are all together in one place.
- Download any tax documents such as unemployment 1099-G forms or other forms that are only available online such as some investment 1099s and tuition form 1098-Ts – as soon as they are available.
- Total all of your out-of-pocket medical expenses for you, your spouse, and your dependent children for the year.
- Gather any donation receipts and request any donation summaries or donation acknowledgment forms from charitable donations made in 2021.
- If you have a business, total your income for the year and summarize and categorize your business expenses for the year.
- If you have a rental property, total the rent received, the days rented, and personal use days and summarize and categorize the rental expenses for the year.
- If you sold your home, vacation home, or rental property during the year, gather the closing document for the sale and the original cost of the property plus improvements.
- If you had a new baby this year, make sure that you have a social security number for the child in order for you to claim the child as a dependent on your tax return.
- If you get your taxes professionally prepared for you – make your tax appointment as soon as possible!