Did you know the regular American spends about 16 hours on average completing their tax return? Given the average tax payer earns about $25 per hour (before paying those pesky taxes), this means they have spent about $400 in sweat equity on their taxes, and we know many who would rather work on their homes, mow the lawn, fix a car, or watch paint dry. But if you need to file taxes before tax day – which is incidentally coming up this week – we’ve got 5 last minute, must read tips for tax preparation.
1. Go Through Your Own Bookkeeping Records
Have a bookkeeper? Most people don’t, although we can help with that. For those of you who do your own bookkeeping, do it now. Having all of your expenditures, income, deductions, credits, and all in a straight line are far more likely to have your taxes done in less time, whether you do them yourself or…
2. Hire a Tax Preparation Services Pro
Chances are if you were going to do your taxes, you would have done them by now. So if you haven’t, call a tax preparation services pro now, not later. We give you permission to stop reading. As we can attest to, the phone is ringing off the hook even now and slots are filling up fast. Be sure one of them is reserved just for you.
3. Calculate All of Your Write Offs
Unless your filling out the short form (and if you are why haven’t you finished filing your taxes by now?), you probably have a whole host of credits and deductions that justify your filing the long form and putting up with all the pain of tax time. Be sure to calculate the amount of each of these write offs including:
- Mortgage payments
- Mileage used for work related tasks (not going to or from work)
- Day care
- Internet and phone related expenses related to work
- Health insurance costs
- Healthcare costs if they total 10% of your income, i.e. $2,500 if you make $25,000
- Charitable contributions including cash donations, donation of goods, and mileage
- IRA, 401 (k), and other retirement investments
- Expenses related to education including tuition, books, parking, etc.
- Even tax preparation fees if they are 3% of your gross income
- and many others as listed here
4. Invest in Your Retirement
Your taxable amount of income isn’t set in stone just because the tax year ended. You can still contribute up to the maximum allowable rates to your eligible IRAs and other retirements accounts, effectively shielding your hard earned money from the IRS. Those who are under the age of 50 can still contribute up to $5,500 to their retirement, while those over the age of 50 may contribute up to $6,500. Married couples also can contribute in certain amounts.
5. Tax Day has Moved!
Usually tax day falls on April 15th each and every year. However, your 2015 taxes are going to be due by April 18th, which can be a great thing for those of you who love to procrastinate. The reason for the change is that Emancipation Day falls on April 15th of this year. It is the day dedicated to in which then President Abraham Lincoln freed over 3,000 slaves in the capital of the nation, and by IRS law, takes precedence over tax day.
Houston Tax Preparation Service
If you live in the area and need Houston tax preparation services or bookkeeping in general, send us an email or give us a call at 281-894-6494.