Sunday, October 17, 2021
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5 Tips For Simplifying Your Taxes

Tax returns are a major source of stress and frustration because they can be complicated, especially for people who need to take deductions o run their own business. On the bright side, they don't have to be nearly as complicated as people think. There are quite a few ways to simplify the process to preserve both your time and your mental health.

 

Use Tax Software

The easiest way to make it through tax season is to make your computer do all the work! Modern tax software can walk you through the process and do all of the math for you. All you need to do is get your financial records and give it the numbers when it asks for them. Some systems can even send your tax payments to the IRS for you!

 

Some people hesitate to use software because they think they will need to pay for it, but most people will qualify for free access. The IRS runs a free file program that provides free tax software to people with an income of $66,000 or less.

 

Consolidate Credit Cards

It can be a hassle to sort through a heap of financial documents to get the information you need, and one of the easiest ways to save time is to reduce the number of documents. You can use that by using a small number of credit cards for most of your purchases instead of making small payments on a bunch of them. This is especially important if they send you cash back as part of a reward program, since that money needs to be taken into account when paying your taxes.

 

Be Early

You should always do your taxes early. You discover that you need to find a document or look up a policy while you are working, and that can be stressful if you are short on time. Doing things early will also help you avoid the rush near the due date if you need to get help, since there will be less people working on their taxes at the time. This technique doesn't change the work that you need to do, but it will make that work much less stressful, which makes the process much easier to handle.

 

Apply for an Extension

If the worst comes to worst and you are running out of time, you should file for an extension to get more. Doing so isn't ideal, but the added time will reduce the odds of making mistakes due to your rush, which will make things simpler in the long term.

 

Applying for an extension is fairly easy. You simply submit Form 4868 to the IRS. The form is fairly simple, and most tax software can handle it for you if you are using it.

 

Use Publication 17

Very few people understand the tax code. The people who make taxes look easy are the ones who know how to look things up as needed. The easiest way to do that is to use IRS Publication 17, which is a reference book for filing taxes. The book is quite long, but you don't need to read the whole thing. It is best to use it like a dictionary and only look up the parts that you need as you need them. That ensures that you can get reasonably clear instructions whenever you find a topic that you do not understand. If you are using a digital copy, remember that you can search the document for keywords to find things as quickly as possible!

 

Strive for Simplicity

Simplicity is a good thing when it comes to taxes. After all, mistakes can be expensive, and keeping it simple will save a huge amount of time and money. In most cases, all you need to do to simplify the task is use the resources that are available. The tools may be hard to find, but they are out there for the people who reach out for them.

 



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