If you are like most people, the thought of filing your taxes is enough to make you break into a cold sweat.
But this year, there’s no reason for that! You can easily cut down on stress and file an accurate tax return by taking advantage of the following six tips.
1. Get organized
The most effective way to stay on top of your tax situation is to keep careful records. This means writing down all the relevant information – not just the numbers, but how and where you acquired them as well.
Make copies of all deeds and titles for any property you own. Save receipts for every item you purchase and look up its fair market value. Be ready to account for every single cent, even the ones you spent on your cat’s litter box liner. A little extra organization at tax time goes a long way.
2. Start early!
Yes, it’s still deductible if you file an extension, but that doesn’t mean you should wait until the last minute. It’s much easier to have all your records saved and ready to go weeks or months before you file, rather than scrambling for one particular receipt on April 14th. Filing an extension takes time, effort, and money – don’t let it be a hassle!
Start now. You’ll feel better when you know that your records are in order and all the information is ready to go, rather than scrambling at the last minute.
3. Use every tax deduction you can
It only makes sense to make the most of any tax deductions or credits available to you! Don’t let yourself get distracted by other people’s business – use what you can and move on. At the same time, don’t be afraid to ask your tax professional about deductions you haven’t heard of before!
4. Scan receipts instead of saving physical copies
You don’t have to keep every single receipt from every last cent you spent during the year – sort through them now and then for any significant expenses.
For day-to-day items, like groceries or household goods, take advantage of online services like IFTTT (If This Then That) to create digital receipts for you! This way, all your receipts are safely stored in the cloud and only come out when you want them to. No more clutter!
5. File early!
It’s not always easy to find the time to sit down and file your taxes, particularly if you’re self-employed. But if you don’t have a lot of tax deductions, filing an extension is just fine – it will give you more time to gather all the relevant information before June 15th.
However, filing early is always an excellent idea. You can sit down with all your relevant information and spend the time you save working on other things!
- If you’re self-employed (or even not!) consider hiring a tax professional. If you need assistance, The Oasis Firm can help with tax filings.
Self-employment taxes are complicated – it’s challenging to keep track of deductions without an experienced professional. Many people take the safe route and hire an accountant to make sure they get everything done right!
That way, you don’t have to worry about making a mistake or paying unnecessary taxes – let someone else do it for you. You can sit back, relax, and think about what you’re going to do with all that extra money.
As you can see, there’s no reason to be stressed when it comes time to file your taxes. The key is to start early and get organized!
If you take the information in this article to heart, you should have nothing to worry about come tax season.
Frequently Asked Questions
Because the Internal Revenue Service only recently released its revised tax brackets for 2021, these are just preliminary numbers.
What Are The New Income Tax Brackets For 2021?
The new, proposed income tax brackets are as follows:
- Here are the standard deduction amounts for single filers in 2021: $12,000 under age 18; $24,000 for those aged 18 to 24; $35,000 for 25-year olds; $48,000 for married couples filing jointly with one spouse under age 65; $60,000 joint income earners in the 65+ bracket.
- Here are the corresponding deduction amounts for single filers who are over 65 years of age: $15,000; $30,000; $42,000; and $54,000.
- And here are the standard deduction amounts for joint filers in 2021: $24,000 if both spouses are under 65 years of age; $60,000 if one spouse is over 65 years of age and the other is under 65 years of age; $96,000 if both spouses are over 65 years of age.
- Here are the corresponding deduction amounts for joint filers over 65 years of age: $30,000; $70,000; and $102,000.
- The new tax brackets and rates will go into effect on January 1, 2021. However, it is essential to note that you will pay taxes on your earnings at the rates that were in effect during the previous year.
Remember to consider all of your sources of income before determining your estimated tax payments. This includes traditional employment income, self-employment income, investment income, and rental income.
What Tax Brackets And Rates Will I Pay?
If you are unclear about which tax bracket you will fall under in 2021, now is the time to figure it out. You can use your previous year’s tax return as a guideline for this year’s tax return.
What Will I Owe?
When preparing your 2021 tax return, be aware of the most common tax mistake to avoid: forgetting to include all of their sources of income. Please keep this in mind as you prepare your 2021 return.
What Will I Receive In Refund?
In addition to including all of your sources of income on your tax return, be sure to estimate your standard deductions accurately. You can also increase your chances of receiving a larger refund by using e-file and direct deposit. Most tax returns are received within three weeks when you complete these steps, but it can take up to eight weeks if you file paper returns.
Taxpayers may use a tax calculator to determine whether they should complete form 1040A, 1040EZ, or 1040.
What Can I Deduct?
If you have completed your 2021 tax return, be sure to review it thoroughly before submitting it. The IRS recommends that you always double-check your return for errors and deductions.
You can make any necessary corrections before filing your returns, or you can file an amended tax return online. It is important to remember that the deadline for filing taxes varies by state. For instance, New York has a tax deadline of April 15, while Utah’s deadline is April 30.
If you need help with this year’s tax filing, don’t hesitate to call us at The Oasis Firm. Once we’ve set up everything, you can send or upload your documents in the comfort and convenience of your home using your desktop computer or mobile phone.
Additionally, we will review your tax documents with you before sending them. Once everything is set, we will submit them on your behalf. We literally do all the hard work for you!