Are you ready for tax day? Since the deadlines are strict and penalties will be imposed for late payment of taxes, you must ensure that you do not postpone your “tax day”. You should definitely start preparing your tax return well before April 15th. Whether you’re doing your own tax return or getting help from a chartered accountant or a company to prepare your tax return, there are a few things you should put together. before starting or meeting with the accountant.
The main thing you will need
for your tax return is proof of your income and the taxes you paid in the previous year. This includes income generated by employers, interest from accounts, dividends from investments, income generated from self-employment, income generated as a subcontractor, and any other income. Student loans and other types of loans can also be considered income for income tax purposes, just like winnings from a lottery, casino, or other contest. If you are unsure of what qualifies as income for tax purposes, you should contact a chartered accountant.
The other important thing is
social security numbers for every one you write down on your tax return. This includes the social security numbers of your spouse and any children you follow. Without Social Security numbers, proof of residence, and dates of birth, you cannot claim deductions on your tax return for these people.
The next thing you need to collect
is what you will need for the deductions. If you have a mortgage, your interest paid to the mortgage company may be tax-deductible. If you use a vehicle for business purposes, you can claim a mileage tax deduction. If you have children in daycare so that you can work, you can claim a tax deduction for this expense. You can also claim tax deductions for excessive medical expenses and charitable contributions.
If you are self-employed,
you will also need to collect your receipts for tax-deductible expenses. A tax-deductible business expense is any expense that is used solely or primarily for the business in which you are involved. The tax-deductible expense needs to be documented in order to claim it, so any receipts you have, computer and vehicle usage logs, etc. must be gathered so that you can benefit from the highest possible deduction. If you have any doubts about what is tax-deductible for your business, you should contact a chartered accountant to help you with your tax return preparation.
Once you have gathered
all the necessary tax documents, you need to determine which tax forms you need to file. If you are an individual with few tax-deductible items, you can file a simple income tax return. However, if you are self-employed, you must also file a specific tax form. If you have a lot of tax-deductible items, you’ll want to file a more complex tax return to itemize your tax deductions. If you are unsure of which tax forms to file, you should contact a chartered accountant to help you prepare your tax return.
Tax Day can be a stressful time,
but it is not compulsory. Gather all your required tax documents as soon as possible and don’t delay the inevitable. Contact a chartered accountant as soon as you can if you are unsure of the tax forms you need to file or the tax deductions you can take.
And, above all, don’t panic on tax day!