18 Mar A Quick Guide to Tax Preparation
A Brief Overview of Good Tax Preparation Practice
For someone without finance experience, tax preparation can be surprisingly stressful. While this is true for individuals and their personal taxes, for new business or startup company owners, it can be overwhelming. Getting tax preparation right can save you time, money and a lot of anxiety.
This is one of the many services offered by the professional team at Jeff Pickering, CPA, but we can also offer some more general, simple advice here. In this blog, we’re going to offer some guidance on how to approach tax preparation and streamline your personal process.
Talk to a Tax Preparation Professional
At the risk of sounding like a sales pitch, employing the services of a tax preparation professional is a great way to get reliable, assured results. A tax preparer will be equipped with the knowledge of the often-complex federal tax system, along with the relevant qualifications, so that you know you’re getting service you can trust.
When looking for a professional to handle preparing or filing your taxes, make sure that they have a Preparer Tax Identification Number (PTIN) so that you know they’re fully authorized.
Get All Your Paperwork Ready
One of the most frustrating parts of getting your taxes ready for filing for many people is getting all of the paperwork together. This can be a lot even just for individual purposes – but for business owners, it can be a real headache.
The best way to do this is to make it an ongoing process. If you have a tax preparation professional to help, go through what you’ll need well before tax season, and make sure the appropriate paperwork is saved.
This will typically include things like your W2, health coverage documentation, information about property you own, and certain specific information about your business. This paperwork will vary depending on each situation, so it’s important to find out in advance what you’ll need and keep it organized.
Make Sure You Have Your Receipts
If you’re itemizing your deductions, you’ll need to keep your receipts. Itemized deductions usually mean a larger write-off, which is good for your bank balance – but might not be so good for your blood pressure.
To avoid stress and confusion, create a filing or organizational system for your receipts that’s easy for you to understand and provides a safe, simple place to keep them all. Receipts pile up fast, whether they’re for business lunches or gas usage, so keeping them properly sorted is essential.
Record Your Charitable Giving
If you’re the charitable type, you’re likely to be eligible for deductions if you’ve been keeping track. In order to claim any charity-related write-offs, you’ll need to provide specific details. Charities and nonprofits almost always send you some kind of receipt or acknowledgment of your donation, which you should always keep for tax purposes. If you haven’t, contact the charity. They will be keeping a record of donations, and should be able to provide you with an acknowledgment if needed.
Personal Information for You and Your Dependents
One of the easiest ways to be caught off guard when you’re filling in tax information is personal details – especially of dependents. For some people, remembering your own social security number can be difficult enough, but if you have children or dependent family members you’ll need that information to file.
If you own multiple properties, you’ll also need relevant information about them close to hand, too. While none of this is all that difficult to get hold of, not having it ready will draw out your filing process. Make sure to have the relevant paperwork – all of it – ready before you begin.
Keep Copies of Your Returns
Filing your taxes isn’t just about preparation. You should keep copies of your previous tax returns, whether physical copies or saved copies on a secure computer or other device. Having ready access to your previous returns – as opposed to having to go through the IRS or a third party – can be useful at some unexpected times.
Contact Us for Tax Preparation Services
It’s important to keep in mind that this is just general advice, and may not apply to your individual situation. For professional tax preparation and related services, contact our accounting firm today. With over 22 years of experience serving individuals and international businesses for all their financial and tax needs, we have the skills to help you. We can bring personalized service to your business.