Rush rush: We're always on the go. There's not time to sit down and make sure our financial information is secured and accounted for. Before you know it you have a huge monster called "The IRS" breathing down your throat. You're not alone in this, like I've been discussing in this blog the past few weeks, even entire cities can easily get behind. And it all comes down to one thing- organization.
Organization is key: Businesses need marked calendars and even digital reminders to make sure quarterly taxes are paid on time. It's a little easier when you have to pay taxes weekly or monthly. But when you have to pay once a year, it gets a little trickier. When tax time rolls around it's a mad dash to the finish line- with papers flying everywhere.
Getting Organized- You'll be prepared when Tax Time Returns
The Keepers: This is the IRS’s official list of definite “Keeps.”
• Credit card and other receipts
• Mileage logs
• Canceled, imaged or substitute checks or any other proof of payment
• Any other records to support deductions or credits you claim on your return
Tax Filing Checklist:
1. Personal Information: You need your Social Security details, as well as the Social Security details for your Spouse, Children, or any other dependants you may have.
If you’ve hired a full time babysitter or nanny, you need their Name, Address, Tax ID, and Social Security Number for your Tax Filing.
2. Employment and Income: You need to have the following forms on-hand:
W-2 Forms for the current year and/or if Form 1099-G if you’ve received Unemployment Compensation for the past year.
Remember to report ALL of your income. Including Alimony received Gambling and Lottery Winnings, or even Jury Duty Pay. Report this miscellaneous income on Form 1099-MISC.
3. Expenses: This is your chance to earn money, so don’t overlook this step.. Here’s some expenses that qualify:
Gifts to Charity, Investment Expenses, Job Hunting Expenses, Child Care Expenses, Alimony Paid, Adoption Expenses, and even Job-Related education expenses count.
Be careful, do not claim expenses if they are not qualified expenses, or you could get end up in debt to the IRS.
Get Organized NOW not later. The IRS announced plans to audit 6,000 businesses, they're cracking down. You need to have tax documentation on hand in case of the worst IRS scenario.