Tax season is upon us and you may be scrambling to get all your ducks in order. Every year we promise ourselves that we will be more organized and a bit wiser when it comes to tax season. It is our own fault when we do not get the most as we can back from tax season due to our poor skills in keeping track of receipts and papers organized. While 2016 may have been a bust, now is the time to make sure 2017 is your best tax season yet. Here are tips on what you can do now to ensure you are getting the most out of your taxes for next year.
This is the first step to an awesome tax season next year. Be sure that you keep everything you need in one central place so that you are not going on a scavenger hunt next year. Keep folders that hold your important documents and financial records today.
Do your charitable donations
Do your charitable donations before the end of the year. When you contribute to charity or donating goods you are helping reduce your tax liability. Keep track of all donations and everything that you have contributed to charity. Ask for receipts and keep them part of your organized folders.
Track job expenses
There are many things we can deduct that we forget to include because we never record them. Make sure that you keep tabs on extra job mileage and expenses that isn’t included in your day to date commute. Keep your receipts because those are expenses that you can claim next year.
You can deduct your volunteer activities?
Did you know that you can deduct volunteer mileage? Keep track of your mileage that you use when you are going to and from any volunteer activity that you do.
Take a look at your retirement fund
You can reduce your tax burden if you contribute to a 401K or a traditional IRA. You will be able to take dollar to dollar reduction in your income for your taxes. Be sure to look into this. Not only are you helping yourself now but you are also helping prepare for a more secure future.
Document retention and control
There may be a ton of documents that you not sure whether you should keep throughout the year or if you can throw away. It is better to err on the side of caution and keep most these for up to one year. Every year make it a point to clean out of the old to make way for the new. If you plan on going paperless, make sure that you are consistently backing up and invest in an external hard drive to save important information.