5 Tips For Doing Your Own Taxes

Tax laws can be complicated, which is why many people hire an accountant or tax professional. At the same time, tax professionals can be pricey, and tax season gives you a chance to get a closer look at your finances. So, if you have the time to do your taxes on your own, consider it, particularly if your tax return is simple (and doesn’t require a lot of forms). These five tips will also make it easier for you to get the best refund.

Keep Good Records

Your records should include everything from your W-2s (and 1099s, if applicable) to your receipts and any records of your donations to charitable organizations. To make sure that you have a full picture of your finances, also gather together your checkbook, credit card statements and bank statements. Next look through all your records and create a list of things that could be considered deductible. Lastly, figure out which tax forms you’ll need to fill out. This way you’ll have all your records and forms in one spot, and you’ll be ready to power through your taxes, hopefully in one sitting.

Understand Deductions

For starters, understand what deductions may be available to you. This doesn’t just go for the well-known deductions that result from mortgage payments and charitable donations. Non-reimbursed medical expenses (in which you didn’t use flexible spending), refinancing expenses, educator expenses, education loan repayments, energy savings home improvement credit, investment expenses — all of these, among others, can often be itemized as deductions, which will help you receive more money back come refund time (or at least reduce what you owe to the IRS).

Use an Tax E-Service

To avoid missing any crucial steps on the forms, consider using an e-filing tax software service. These programs are wonderful at asking you the necessary questions about your tax situation, and they also double-check your work, meaning you don’t need to understand all the tax laws to accurately complete your forms. Many even offer assistance, should you need it. In general, they save you a lot of time, too.

File on Time

Every year is the same: taxes are due April 15th. As such, plan ahead, and don’t wait until the day before or day of to do your taxes, especially if you’re planning on mailing them in. Lines at the post office typically get longer come mid-April, which means you’re spending more time than you need to finish your taxes. While filing for an extension is always a possibility, that also means you’re spending even more time doing — and thinking about — your taxes. 

Plan for the Next Tax Year

By doing your own taxes, you’re getting an inside look into where all your money is going. As such, you can adjust for the new tax year. This also means that if you’re getting an extra large refund, you can adjust your contributions so that you receive more money throughout the year, rather than in a lump sum. Alternatively, if you owe a large amount of money, consider making estimated payments throughout the year.

Taxes don't have to be overwhelming. As long as you get organized and make the time to complete them, just about anyone can do their own taxes.

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