Posts Tagged ‘educational expenses’

Year-End Tax Do’s can save you $1,000’s on your Income taxes.

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. www.gactaxaz.com

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.

Use a folder filing system that you can put in one of those plastic filing boxes.

  • One folder should be for medical expenses. If you have a lot of medical expenses this year you might want to get some work done that you are putting off until next year because not all the medical expenses are deductable or none at all if the amount is not large enough.
  • Another for charity donations, you must have receipts if given more than $250.
  • Another for unreimbursed business expenses.  The mileage on your car if used for work; supplies or computer equipment used at home for work; uniforms; safety equipment like gloves, hard hats, steel-toed shoes; union dues; or license fees.
  • Another is for big purchases like autos, trucks or boats to keep track of sales taxes and license fees.
  • Home Improvements can create tax credits for improving your house with insulation materials, solar equipment, new insulated widows, or high efficient new air conditioners.
  • Education Expenses 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.  Get your day-care provider’s Name, EIN number or Social Security Number, their address and amount paid.
  • 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, Interest and Dividend and capital gains or losses in investments sold.
  • Have a folder for miscellaneous items at year end like W-2’s, 1098’s, 1099’s, Unemployment received information, and Social Security year-end information sheet.
  • Student Loan Interest can be deduction.
  • Contribute to a Roth or Traditional IRA.
  • Remember to contribute to your Public Schools to receive up to $400 in tax credits in Arizona.
  • Home mortgage interest, property taxes and auto registration fees.

The first step is to set up a folder system to gather all this information.

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.

File early so if it is going to be bad news and can plan for payment, or to get your refund early to plan for the big purchase or big vacation.

What do you want to purchase with your big refund?  Where do you want to go on that big vacation?