We agree that taxes might not be the best topic to talk about. After all, taxes can be stressful; paperwork, deadlines, deductions, credits, and more can make filing unbearable.

But, it does not have to be that way. With the right preparation, taxes can actually be quick and painless. Given our expertise, we’ve decided to outline the top five things you need to know when preparing your return this year.

1. Use Auto Deposit

There is nothing more frustrating than waiting for a physical return to be issued. Having to wait for a physical cheque causes wait times to increase by weeks or even months.

So, to avoid any delays, sign up to receive direct deposits from the IRS. This feature offers taxpayers a quick, fast and secure way to get their money directly. The IRS even gives people the option of depositing a cheque into multiple personal accounts (up to three).

2. File Electronically

E-filing is the way to go since it’s quicker to do when compared to filing it manually. Completing taxes online also means you avoid administrative mistakes since each section is in a question-and-answer format. Meaning, your return will be completed quickly and without any errors.

3. Collect Your Documents

In addition to all the standard forms you should be collecting for your tax return (W-2s, Form-1099, etc.) there are some documents you might want to have on hand before you file.

Some things you might want to begin collecting include documents on cryptocurrency transactions, alimony cheques, and other income sources (such as gambling, jury duty pay, etc.)

Regardless of what you have, keep these documents stored in an easy-to-find place and ready to go. This will help you in case the IRS contests a filing and you are requested to submit the information.

4. Apply for Credits

If you don’t take the time to look into and apply for tax credits you could be leaving money on the table. But, to be eligible for credits you need to provide documentation.

For example, if you sought out any type of higher education throughout the year, you would need to fill out Form 1098-T as proof of the expense. For child care, all the details will need to be actuarily recorded itemizing the care provider’s name, address, tax identification, and cost. And even for health care, if you purchased insurance through the Health Insurance Marketplace, Form 1095-A is required.

5. Submit Proof of Losses

Did you know that certain types of financial losses are deductible? If not, you could be missing out on a potential return. That’s because stocks that have become completely worthless, or ones where you are expected to claim a loss can be claimed as a deductible. For these, the original date of purchase and the purchase price will need to be submitted.

Another loss that might be deductive is any non-business debts that are not collectible. An example of this would be if you lent a friend money from a personal account, and that friend did not repay it.

However, keep in mind that these situations can be subjective which is why it’s best to consult with professionals before submitting.

Otherwise, you might encounter issues, delays, and even audits. But that’s why we’re here to help. We have a team of experts that can take care of your filing. That way, you can rest assured come tax season.

If you’d be interested in learning how we can help you, give us a call at 407-328-5001 or contact us here.

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