At Hacker Accounting, customers frequently ask us when is the best time to start preparing their taxes for the next season. While you should be preparing year-round by saving relevant receipts and documents, certain instances and events are more important to take note of for tax season than others.
When You Get Married
One of the many perks of marrying your sweetheart is a lower tax rate. When you file jointly as a married couple, you will almost always pay taxes at a lower rate than if you file single. This increases your chance of deductions.
When You Donate
Charitable donations are tax deductible if you itemize them on your return. Keep track of any checks written, make a note of cash donations, and if you donate to any charities during the holidays, hold onto those receipts.
When You Get Mail
W2s, 1099s, and other important documents should all be saved for tax season. Employers will typically send these in January or February of each year, but if lost or discarded, it can take time to track down duplicates of these forms.
When You have Children
Children or other individual that are considered dependents each come with a tax deduction that lowers the amount you owe the IRS.
When You Buy or Sell a Home
If you buy a home, you’ll often get a tax break to allow for mortgage and real estate taxes. If you’re selling, you may be charged more tax on the amount earned from the sale. Consider how this may affect your tax situation as you consider your next steps in real estate. Keep thorough documentation of the entire process.
When You Pay Tuition
If you’re paying college tuition or student loan interest for a dependent, that’s another tax break. Though a tax credit isn’t a great reason to take out a loan, know that doing so may help your financial situation when it comes to paying taxes.
For over 15 years Hacker Accounting has been helping families and small businesses navigate tax season. For help preparing your taxes, give us a call at 602-375-5251.