5 TIPS FOR successfully filing your tax return

WORDS : JAMES R. MARING, SERKLAND LAW FIRM

For most people, the thought of preparing their tax return is as daunting as public speaking. However, here are some helpful tips to help make the task a little less intimidating.

1. GET ORGANIZED

The key to minimizing the stress of tax preparation (and potentially reduce cost if using a professional) is to be organized. The more organized you are the less time it will take to get your tax return completed properly. I recommend you organize your tax documents in separate categories as personal information (such as the social security numbers for you, your spouse, any dependents), income, personal deductions, and business information (if applicable). If you do own a small business or have other side income, you need to keep your business income and expense items separate from your personal information. Some expenses are deductible for a business but are not allowed as a personal deduction.

2. REVIEW LAST YEAR’S TAX RETURN

An important document to review while preparing your taxes is last year’s income tax return. Most people don’t have too many changes from one year to the next. Therefore, this is a great way to check to make sure you aren’t forgetting anything such as a loss carry over or perhaps a tax credit or deduction that you qualify for and have used previously.

3. DON’T FORGET ABOUT YOUR RETIREMENT ACCOUNTS

If you participate in an employer-sponsored individual 401(k) plan or other qualified retirement plan, the deadline for contributions is Dec. 31. However, you can still fund an Individual Retirement Account (IRA) until April 15, 2020 and deduct the contribution amount toward your 2019 taxes. This is a very effective way of both lowering your 2019 tax bill while also bolstering your retirement funds. If you don’t have an IRA account set up, simply contact your bank and they should be able to assist you. The process is very simple and worth the effort.

4. GET HELP

You don’t need to take this task on by yourself. Fortunately, there are companies that offer tax software programs to help you complete the tax return quickly and relatively inexpensively. The IRS even offers free tax filing software for taxpayers with an adjusted gross income of $69,000 or less. When deciding whether to use a professional preparer or a software program, consider your income, the complexity of your return, unusual events that significantly affect your income or expenses, and your concern about a tax audit.

5. STAY INFORMED

Even if you use a tax professional, it is still wise to be as informed as possible regarding the tax laws that may affect your income tax return. The tax laws are constantly changing, and therefore it is important to spend some time trying to stay on top of the current changes. For example, the standard deduction amount changes can impact your decision whether it makes sense to itemize your deductions or use the standard deduction to lower your tax bill as much as possible.

JAMES R. MARING

This article was prepared by Jim Maring, an attorney with the Serkland Law Firm in Fargo, North Dakota. For more information, call 701-232-8957, email jmaring@serklandlaw.com or visit serklandlaw.com.

This article should not be considered legal advice and should not be relied upon by any person with respect to his/her specific situation.