Top Factors that Affect Your Tax Preparation

Tax season officially begins on January 20, 2015. Even though you still have plenty of time to file your return, it is best to file early to avoid scam attempts. Moreover, the earlier you prepare your taxes, the faster you get your refund. Filing early also helps you to make adjustments, if any, before the filing deadline.

Whether preparing your return for 2014 yourself or through a professional preparer, keep these factors in mind:

-    The Affordable Care Act. Know how the Affordable Care Act (ACA) impacts you. Even though for most taxpayers the ACA will not present tax difficulties, you must ensure that you report any major changes in your life such as change of address, name, birth of a baby, divorce, and marriage. Also, consider if you are eligible for an exemption. If you are not covered and you are not eligible for an exemption, then the IRS will charge a penalty for non-compliance.

-    Credits and Deductions. Only claim deductions and credits that you qualify for. You may check the extended tax deductions and credits for 2014 and consider your eligibility.

-    Preparer Tax Identification Number. Make sure that your return preparer has a valid Preparer Tax Identification Number (PTIN). Every practicing return preparer must have a PTIN. Attorneys, CPAs and enrolled agents can also prepare tax returns. To find a legitimate tax return preparer, check the IRS list of tax professionals.

-    Tax Documents. Ensure the information that you indicate on your return is accurate. Gather any necessary documents, records and receipts to back up claims that you make in the return. In case of an audit, the IRS will ask you to provide proof of the deductions and credits that you claim on the return. Keep a copy of your return before you file.

-    Filing the Return. If your preparer is filing your return electronically, you must sign your return only after all the information has been filled in. Review the information and re-check calculations.

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