The Basics of Tax Preparation

Tax Preparation is one of the most important factors when it comes to getting the most out of your taxes. If you do not prepare your taxes properly, you will not get nearly as large of a return on your money.

Tax preparation is also very confusing and time consuming; many people who try to prepare their own taxes end up costing themselves more in fees than they would’ve if they had just paid someone else to do it.

There are multiple ways that people can save money when filing their taxes. Here are some important things to know.

What Needs to be Included When You File Your Taxes

Tax PreparationThere are several different documents that you should include when filing your taxes. The most important of these would be your W-2 forms and documentation for any money you made from tips. If you worked as a freelancer during the year, also be sure to include all of the forms and statements pertaining to what you did; this includes 1099s and invoices that were sent out by clients or employers.

Other things that need to be included in your tax return are documentation for alimony payments, childcare expenses, moving expenses, education expenses, student loan interest paid on education loans, any income that was earned overseas or within U.S. possessions (such as Puerto Rico), capital gains income recorded during the year, home office deductions, and everything else that you think may be pertinent to the deduction.

Hire a CPA

When you are finished collecting all of your receipts, documentation, and information pertaining to your deductions, it is time to start filling out your return form. We recommend hiring a CPA to handle this for you so that there are no errors made while filing. This way, you can rest assured that everything has been done properly without any mistakes because paying an accountant or tax preparer to file for you will end up saving yourself more money in the long run. The fees associated with using an accountant are much less than what they would receive back on their returns if they try filing themselves because of all the deductions they missed over the year.

How to Get the Most On Your Tax Return

Tax PreparationWhen it comes to getting as much as you possibly can back on your returns, there are some things that need to be done. Once you have all of the necessary documents and forms, the first thing we recommend is using a calculator for quick and easy addition and subtraction. Then make sure to check whether or not what you claim is true. Your CPA will do this for you and make sure everything is accurate.

For example: If you own a home then there are deductions that can be taken from the interest paid on your mortgage. If something seems fishy or unsure about any of these figures then double-check them before filing. It is important to know what tax laws apply in certain situations so that no mistakes along those lines are made.

Again, your CPA will be able to help you with this.

Tax laws change every year, so it is important to keep up with them and make sure that you are filing correctly and on time. The best way to do this is to hire a CPA to make sure the job is done right.