Tax season officially begins next week.
To help you navigate this process, here’s what you need to know before you file:
First and foremost, make sure you have all the necessary documents. This includes your W-2 form from your employer, any 1099 forms for freelance or contract work, and any other relevant tax documents. You’ll also need your Social Security number or taxpayer identification number, as well as any relevant financial account information for direct deposit or electronic filing.
Next, decide how you’re going to file your taxes. The most popular options are tax preparation software, working with a tax professional, or filing manually using paper forms. Each option has its pros and cons, so be sure to consider your situation before making a decision.
If you choose to use tax preparation software, be aware that most providers offer a free option for basic returns, but charge extra for more complex situations. If you’re working with a tax professional, be prepared to pay a fee for their services, but they can offer valuable expertise and help ensure that you’re getting the most out of your return.
Another thing to remember is that the tax laws have changed in recent years, so be sure to familiarize yourself with any new deductions or credits that might apply to you. For example, the Coronavirus Aid, Relief, and Economic Security (CARES) Act has added unique tax benefits for those who have been impacted by the pandemic, such as a $300 above-the-line deduction for charitable contributions.
It’s also important to note that the tax deadline has been extended for the 2021 tax year. The deadline for individuals to file and pay their federal income taxes is May 17, 2021, giving taxpayers an additional two months to file and pay their taxes.
Finally, be sure to double-check your work before you file. Mistakes on your tax return can lead to delays, additional fees, and even an audit. Take the time to review your return carefully, and if you’re unsure about anything, don’t hesitate to reach out to the IRS or a tax professional for guidance.
In conclusion, tax season can be stressful, but by being prepared and taking the time to understand the process, you can ensure that your taxes are filed correctly and on time. Remember to gather all your necessary documents, decide on a filing method, familiarize yourself with any new tax laws, and double-check your work before submitting your return. With the right preparation and guidance, you can get through tax season with ease.