Organizing your taxes can be a daunting task, especially if you're not sure where to begin. In this article, we will provide you with some helpful tips to make tax season less stressful.
We’ve got you covered — from organizing your receipts to using tax software and consulting with an accountant. We'll even share a unique way to manage your stress during tax season. So, let's get started!
Keep your receipts categorized in an accordion folder
You’ll need an accordion folder to start. Label your accordion folder according to your usual tax deductibles:
- Medical and dental expenses
Keep all the dental and medical receipts that you paid out of your pocket. These include co-pays, deductibles and prescriptions.
- Charitable donations
You can keep your receipts or acknowledgment letters from charitable organizations you helped throughout the year.
- State and local taxes
If you made any payments for state or local income or sales taxes, they can be kept organized, too.
- Homeownership expenses
These are receipts related to owning your home, including mortgage interest, property taxes, and home improvements.
- Education expenses
These are education-related expenses such as tuition fees, textbooks, and supplies.
- Job-related expenses
These are receipts for expenses that your employer did not reimburse, including work-related travel, uniform, and tools.
- Miscellaneous expenses
Any other tax-deductible expenses such as tax preparation fees, and safe deposit box rental fees.
You can also do the standard deduction, which allows you to lower your income at a fixed amount.
Use tax software like TurboTax
Turbo Tax is one of the more popular tax preparation and filing software. It asks you questions along the way to help it determine what tax form you need to file. It will also identify the deductibles you can get.
If you’re worried about tax filing differences per state, it also helps you with state-specific guidance.
There is a free version that allows you to do it yourself if you have simple tax returns. There are also paid versions if you want to maximize your deductions and if you have investments like stocks, bonds, and rental property.
Keep soft copies or backups of your tax documents
It can be tedious, but keeping soft copies of your files on your computer or the cloud will be pretty handy. In worst-case scenarios like weather-related issues, you won’t have to worry about your receipts and files.
It’s best to scan the documents right when you received them. And then organize them into folders on your computer. If you want them accessible on all your devices, you can create dedicated folders on the cloud, like iCloud or Gdrive.
Consult with an accountant for maximum tax benefits
Tax experts or accountants are handy especially if it’s your first time filing your tax returns.
They can advise you on the proper forms to fill out. More importantly, they can help you understand tax credits. For example, an Earned Income Tax Credit can help you lower your tax liability.
Moreover, a professional can help you avoid penalties related to unaccounted taxes.
Manage the stress with CBD gummies
Tax season is probably one of the most stressful responsibilities you have to do as an adult. It happens yearly. And if you’re not careful in filing completely and accurately, you can be audited.
CBD or cannabidiol in the form of gummy candies is the simplest way to relax and manage your stress. The Verma Farms CBD gummies are generally safe to use and are grown and manufactured on US soil.
You can pop in a gummy at the start of your day or any time of the day to help you focus and organize your taxes.