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Tax

Tax Time

4 Tips to Help You Expertly Prepare for Your Taxes

Very few people enjoy paying taxes, but many find the process of preparing and filing returns unpleasant, as well. There are plenty of good reasons to have a professional take care of most of that work, and such investments quite often pay off.

Even those who plan to have someone else prepare their tax forms, though, can make things still easier on themselves. Seeing to four simple issues before heading to a local tax preparer will make for an even smoother experience.

Any Taxpayer Can Make the Process of Preparation Easier

Having your taxes prepared by a professional is a widely recognized way to minimize the likelihood of errors and keep the total owed to a minimum. Particularly given the reasonable prices charged by many tax preparers, going it alone will rarely be fiscally prudent.

Of the 150-million-plus individual returns sent to the Internal Revenue Service (IRS) in an average year, though, relatively few filers do much to prepare themselves properly. That often makes tax season a bit of a hassle even for the many who choose to have professionals handle the bulk of the work.

Putting in an occasional bit of effort here and there will make a trouble-free filing experience more likely. The four steps that help the average taxpayer the most are to:

· Keep collecting receipts. The IRS audits taxpayers less frequently than in the past, with only around a quarter of a million now becoming subject to face-to-face enforcement actions in most years. That has led many taxpayers to become lax about documenting their expenses and other sorts of deductions. While this will inevitably prove costly if an IRS audit should follow, it makes routine tax preparation more difficult, as well. Having a complete collection of receipts, invoices, and payment details will allow a tax preparation professional to proceed with more confidence. It takes relatively little time, when all is said and done, to collect such documentation in a single place, so just about every taxpayer will do well to do so.

· Have all the required forms ready. Outlays are only ever one part of the tax preparation equation, with wage income and other revenues being every bit as important. Most taxpayers receive IRS-standardized W-2 forms from their employers, but there are quite a few other kinds that are common, as well. Being sure to have forms like the 1099-INT and 1099-MISC on hand will make the tax preparation process easier, whatever the particulars.

· Be prepared to make retirement contributions. The federal government is fairly generous about encouraging workers to set aside money for retirement. One common and entirely aboveboard tax reduction strategy is to be sure to hit retirement account contribution limits, where that will make a difference. Having cash on hand and ready for that purpose will make it easier to respond when a tax preparer highlights such an opportunity. Contributions for each tax year can generally be made right up until the date that a return gets filed.

· Get started early. Many individuals wait until the last minute to rush over to a local tax preparation office. Each year’s taxes can be prepared and filed, though, as soon as the required information and forms become available. Getting a head start on the masses will rule out last-minute stress and difficulties.

Preparing for Tax Preparation Produces Impressive Returns

Simply keeping up with basics like these can make the actual process of tax preparation quite a bit simpler. That is true even for those who have tax preparation professionals get their returns ready each year. Paying taxes might not be much fun, but making sure a return gets prepared and filed never needs to be a hassle.

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