Usually, tax planning is not included on most people’s lists of new year’s resolutions. However, maybe 2014 ought to be the year when you make the effort to understand more about your taxes. This will allow you to correctly plan and organize your responsibilities.
This resolution will help you once tax season arrives, and it might result in you saving more cash over the long run.
Here’s some advice to help you get started on achieving this goal:
Organize your tax file for 2014. This might be an online file, where you can scan transactions and documents over the course of the year. This will impact on your total tax amount. Alternatively, you could use a bin or folder to store the details.
The advantage of electronic files, like Turbo Tax 2014, is that when your tax is due, you can just email the data to your accountant. Then, he or she can keep the file for use during an audit. Ensure that you have sufficiently backed your data up, just in case an unforeseen problem arises. Including notes on your tax documents will help your accountant understand the transactions, which facilitates the filing procedure.
Examples of important tax documents are: 1099s, W2s, escrow documents for purchase, K1s, receipts for car registration charges and real estate tax, receipts for additional tax deductible purchases, and letters confirming charitable donations made to recognized nonprofits.
All the best to everyone for a healthy, happy, successful and tax conscious 2014.