Posts Tagged ‘college students’

Mid-Year Tax Do’s and Don’ts

Now is the time to get organized on this year’s taxes.  Remember, the key to saving on your taxes is to staying on top of the information you need.  Follow my blogs and I will keep up to date with the new tax laws.

If you don’t have the tax information and substantiation at your fingertips, then you could easily miss out on tax breaks and end up paying the IRS much more than you should like $1000’s more.

Look at last’s years taxes and see the kind of information that is needed.  That’s why the recommendation to get your tax filing material organized now is a great way to be ready for the year end and the next tax filing season.

Your organization system doesn’t have to be complicated. It can be on your computer via a self-created spreadsheet or one of the many prepared packages available like Quicken or even QuickBooks if you have the software.  You can get cheap software at the local office supply store.  Just remember you do need paper backup.

Or, if you’re old-fashioned, a paper-based filing system is fine like file folders you can put in one of the plastic filing boxes.

  • One folder should be for medical expenses.
  • Another for charity donations.
  • Another for un-reimbursed business expenses.
  • Another is for big purchases like autos, trucks or boats to keep track of sales taxes and license fees.
  • There are also tax credits for improving your house with installation materials and solar equipment.
  • For college students or post secondary education students, the tuition fees, books, supplies and computer equipment are good for tax credits.
  • Day-care expenses can give you some tax credits.
  • Looking for a job is a tax deduction so keep track of the mileage and expenses.
  • Investment information and records of trades and income items.
  • Miscellaneous and items at year end like W-2’s, 1098’s, 1099’s.
  • These are a few suggestions.

The key is to pick one system and stick with it.  But the first step is to set up your system.

Even if you’ve been diligent about keeping all the relevant tax material but just threw it into a box, consider sorting those documents and putting them into your filing system now.

By breaking out the information into the appropriate tax filing categories, your annual Form 1040 tasks will go much more quickly and, I hope, produce a better financial result for you instead of for Uncle Sam.

And as you continue to put material into your filing system, you’ll be alerted to what holes exist in the documentation.

Discovering this means you can plug the gaps as they arise instead of scrambling to find the data when you’re already facing the April 15 deadline.