3 Tips to Avoid a Tax Nightmare

Avoiding tax nightmares

By now, you have already–or will soon–experience all of the issues that come with 2014 tax preparation and filing, assuming that you are doing some or most of this yourself.

Here are some tips that will make it easier for you to have some of your tax work done in advance of the early part of next year.

TIP # 1:  Get a head start with regular filing

Set up files for use all during the year that allow you to keep expenses, income, and tax information organized.  I like to use a crate a file with clearly labeled folders for the various categories all during the year.

This makes it easy to find documents if they are needed during the year and gives you a head start on working with the files when you start working on tax preparation.

Tip # 2: Use software to save time

Use software during the year which makes it easier to have part of your tax work done before you start.  One of my clients uses QuickBooks to write checks for bill payments during the year.

This means that I have to only look for income and expenses on his bank statements which have not been entered and enter them.  This is a big time saver when it comes time to get the information ready for his CPA.

Tip # 3: Pay attention to deadlines

Know how much time you have to work with–in advance–and plan accordingly.  This is particularly important if you have your CPA request an extension for you to file your taxes.

Know exactly when he needs to have your information to do the tax work that he does. Is it September 15, or October 15?  Guessing will only lead to problems. Make your plans based on the exact date.

Robert Sage strives to help clients avoid tax nightmares as much as possible.  Although he is not a CPA, he knows some of the general guidelines and will be glad to answer questions you may have.  Just email Robert here.