Tax Season
Don’t be caught with your pants around your ankles on tax season. Save yourself headaches and stress by planning for success. Expecting the best and knowing the worst will keep you mindful during the tax season; no catastrophes required. Here is a smooth scheduling technique to ease your way into 2021 taxes.
Prepare for Taxes
Schedule a weekend or day off of work during tax season, when you can plan your taxes. If you have not found a tax representative, scout around and find someone who meets your needs. Look for the following:
- Find a tax representative specializing in your field of work or tax form type. Small business owners should not use commercial tax offices. Find tax offices that specialize in small businesses. Schedule a consultation or meeting asap so you know that you have found someone who can maximize your tax return responsibly.
- Before meeting with your tax representative, pull together all of your paperwork and past due penalties. If you have penalties from the previous years, your tax rep may be able to help you negotiate a lower payment with the IRS. There are no guarantees, but preparation improves your tax bill.
- Pull together all pay stubs, 1099s, interest paid (1098) on school loans, Medicaid or insurance forms, unemployment stubs or other tax-related forms beforehand.
- Pull together all credits from childcare, road-related expenses, food-related expenses, lodging, and other out-of-pocket expense.
- Pull together income loss from your business.
- Pull together any charity receipts. Some church donations may not be eligible for tax returns, but organizations such as missionary groups, housing programs, and non-profits are eligible for tax deductions.
Meeting Up With Your Tax Representative
- Once you have pulled together all your tax credits, expenses, and forms your representative may find more potential credits or problems with your 1099 or W-2. You may have to schedule another meeting.
- If you have been through a divorce and pay alimony or child support, include this information with your tax return.
- Ask your tax representative if you can schedule Skype or Zoom calls so you can address minor details while completing your tax return.
Hang In There
Tax Season can be stressful. Prevent problems by anticipating the amount you may owe. Remember:
- It is better to pay ahead of time and estimate your expenses before the due date.
- Set aside the money if you can and feel you need to.
- Tax audits are not common. It’s estimated that less than 2% will be audited. Audits tend to be random. If you are honest and don’t put up any red flags (your account can make sure of this) you should be okay.
- Don’t sit on unopened IRS mail. These notifications are the only way the IRS contacts you with important matters.
- If you make a mistake it’s not the end of the world. Tell the IRS what happened and they may waive any penalties associated with your faux pa.
- Take frequent mindful breaths in between working on taxes. Take a weekend of rest upon completion of taxes.
Early preparation will enable you and your representative to smoothly work through your taxes. Finding the appropriate company to represent you is the first step. If you are inexperienced in small business taxes Don’t Panic. Call Joe Franek! Or you can schedule online HERE.