Tax Tips After Tax Season

With April 15th now behind us and our tax returns filed, it is a great time to begin some basic preparation for next year’s taxes.  This blog post is not about tax planning ideas, rather it is meant as a guide to help with the stress and administration of preparing your 2014 tax return. Here are a few simple items to keep in mind.

For many it is troublesome to find the prior year’s donation and medical receipts after the New Year. Why not take some time now to organize receipts for next year as you are making payments?

  • For those of you who do not use computers, take your paper receipts and simply store them in a file folder.  You may find it convenient to use one folder for medical, another for contributions and a third for everything else.
  • For those of you who do use computers, but not a bookkeeping program like Quicken or Mint, set up subdirectories, perhaps create one for medical, another for contributions and a third for everything else. Scan or copy from websites all of your receipts, and then dedicate a folder for donation receipts and another for medical payments.
  • For those sophisticated computer users who use an electronic bookkeeping program, you have it made!  When payments are made, simply code them to the correct categories and at the end of the year, give your tax preparer a list of those payments.  Remember to save copies of receipts also.

No one likes an April 15th surprise.  So if your income is steady, make sure all of those withholding and estimated payments are made.  If your income changes, review those changes to determine if you will need to make a higher payment, or at least know what April 15th will bring.  Remember this planning goes both ways, so if your income is falling, make sure you are not giving Uncle Sam an interest free loan.

Remember, a little organization now can save a lot of headaches next year.  In the near future we will be posting more on income tax planning ideas and tips so stay tuned.

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