How to Get a Head Start on Your Taxes
Know your rights and responsibilities., Review past tax returns., Select the taxable items to track., Set up a bookkeeping system., Record income, purchases and donations., File receipts by category., Collect tax information., Download tax forms...
Step-by-Step Guide
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Step 1: Know your rights and responsibilities.
Governments publish guidelines for taxpayers so that individuals know what to claim on their taxes, when to file and how much to pay.
In the United States, taxpayers have the right to only pay the amount of tax legally due and the rights to privacy, confidentiality and representation. -
Step 2: Review past tax returns.
Reviewing past tax returns provides a starting point to plan your future tax returns.
Past returns show your earnings, items that you were able to deduct and how much you paid in taxes.
This information will be the basis for building a record-keeping system that adequately documents all items needed for tax purposes. , Track all income and expense items listed on your tax return along with any other items that may be taxable or tax deductible.
In the United States, the IRS suggests that taxpayers keep track of the following:
Income from wages, salaries, tips, interest, dividends, rental property and retirement plans.
Gains and losses on investments in stocks, bonds and other securities.
Amounts paid for medical and dental bills, taxes, donations, employee expenses and education. , A bookkeeping system can be a simple as a checkbook or as sophisticated as a bookkeeping software application.
When using your checkbook as your bookkeeping system, highlight those items that are claimed on your tax return.
When using a software application, use the setup instructions to help you record taxable items. , At the end of each month, go through your receipts and checkbook.
Highlight transactions that will appear on your tax return.
Find transactions easily by tracking these items on a spreadsheet. , Set up a filing system to keep receipts organized and ready.
Receipts can be filed in folders or in envelopes.
It will be easier to prepare your taxes when wage stubs are kept separate from medical expenses and property tax payments. , As soon as the tax year comes to an end, collect your checkbook and receipts and add up the amount of monies you earned and the amounts that you spent. , It's a good idea to have copies of the tax forms you'll need to file your taxes even if you plan to use a tax preparation service.
Use the forms as a worksheet to collect the information needed to complete your taxes. , You have several options:
Do your own taxes.
If your taxes are simple, you can easily fill out your own tax forms and submit your tax return online or through the mail.
Hire an accountant or tax preparation service.
Use a free online service.
Before using any service, check with the IRS or your government's tax authority to ensure the service is authorized. -
Step 3: Select the taxable items to track.
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Step 4: Set up a bookkeeping system.
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Step 5: Record income
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Step 6: purchases and donations.
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Step 7: File receipts by category.
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Step 8: Collect tax information.
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Step 9: Download tax forms.
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Step 10: Find a tax preparer.
Detailed Guide
Governments publish guidelines for taxpayers so that individuals know what to claim on their taxes, when to file and how much to pay.
In the United States, taxpayers have the right to only pay the amount of tax legally due and the rights to privacy, confidentiality and representation.
Reviewing past tax returns provides a starting point to plan your future tax returns.
Past returns show your earnings, items that you were able to deduct and how much you paid in taxes.
This information will be the basis for building a record-keeping system that adequately documents all items needed for tax purposes. , Track all income and expense items listed on your tax return along with any other items that may be taxable or tax deductible.
In the United States, the IRS suggests that taxpayers keep track of the following:
Income from wages, salaries, tips, interest, dividends, rental property and retirement plans.
Gains and losses on investments in stocks, bonds and other securities.
Amounts paid for medical and dental bills, taxes, donations, employee expenses and education. , A bookkeeping system can be a simple as a checkbook or as sophisticated as a bookkeeping software application.
When using your checkbook as your bookkeeping system, highlight those items that are claimed on your tax return.
When using a software application, use the setup instructions to help you record taxable items. , At the end of each month, go through your receipts and checkbook.
Highlight transactions that will appear on your tax return.
Find transactions easily by tracking these items on a spreadsheet. , Set up a filing system to keep receipts organized and ready.
Receipts can be filed in folders or in envelopes.
It will be easier to prepare your taxes when wage stubs are kept separate from medical expenses and property tax payments. , As soon as the tax year comes to an end, collect your checkbook and receipts and add up the amount of monies you earned and the amounts that you spent. , It's a good idea to have copies of the tax forms you'll need to file your taxes even if you plan to use a tax preparation service.
Use the forms as a worksheet to collect the information needed to complete your taxes. , You have several options:
Do your own taxes.
If your taxes are simple, you can easily fill out your own tax forms and submit your tax return online or through the mail.
Hire an accountant or tax preparation service.
Use a free online service.
Before using any service, check with the IRS or your government's tax authority to ensure the service is authorized.
About the Author
Elizabeth Ford
Enthusiastic about teaching organization techniques through clear, step-by-step guides.
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