Meet Uncle Sam, your least favorite uncle. You know the one who shows up to the cookout, empty-handed, but leaves with several to go plates and drunk as a skunk off your liquor. He always has a good time at your expense.
But that is life.
Oddly enough, I realized I have worked through 30 plus tax seasons. So I know a thing or two about surviving tax season. This year’s goal is to survive with a bit less stress, so all parties involved can feel a little better at the end of this.
So here are 10 Tips to make this tax season a lot less stressful.
1.) Be Patient. IRS Delays Are HIGHLY LIKELY – The IRS is still understaffed and underfunded by Congress. COVID issues have caused massive staffing issues. MILLIONS OF PEOPLE are still missing some or all of their stimulus payments and Tax Refunds from 2020. The last time I checked, the IRS still has not opened over 7 million pieces of mail. So the keyword here is PATIENCE.
2.) Start Early -Technically, you should be working on your taxes all year round, but if you haven’t even thought about tax season until now, it’s okay. Gather all your Tax Documents
- 1099s ( INTs, DIVs, MISCs, Rs, Gs)
- 1098s ( Mortgage),
- etc etc…
3.) Scan All Your Documents – In 2021 everyone has a smartphone and that smartphone is also a scanner with apps like Abode iPhone Scanner ( I am sure there is an Android). So get all your money’s worth out of that electrical contraption. You can easily scan up all your documents and upload them to your favorite tax professional’s portal or email them, but emailing sensitive information is a dangerous these days with all the virtual hackers these days.
4.) NEW STIMULUS – Congress is working to provide another round of Stimulus and that will fall in the laps of the IRS to distribute to US Taxpayers as well.
3.) S Corporation Filings – If you have an S corporation (You know who you are). Your Taxes returns are due on March 15th. If your books are not together, get them together ASAP.
6.) Bookkeeping – If you are a business owner or a gig worker, you need to have your books in order.
7.) Crypto Reporting – Now is not the time to try to be slick.Be Sure to Disclose to your Tax Pro if you own CryptoCurrency. The IRS knows who most of the owners are, so tell the truth now or pay penalties later.
8.) Extension – Right now, the tax deadline for most people is April 15, 2021. Last year, the IRS extended the deadline — but nobody knows if this will happen in 2021. If you are hardheaded and don’t take the aforementioned advice, you can still file an extension — but that will push your due date to Oct 15, 2021.
9.) Tax Planning – One of my favorite Ben Franklin quotes goes something like this “If you fail to plan, you are planning to fail.” This definitely applies to taxes. Most of the tax deductions you are eligible for ended on December 31, 2020, for the 2020 tax year. The good news is, you can start planning now for 2021 to make sure you pay the lowest amount in taxes legally possible next year.
This is my best advice to finish up tax season stress-free.. If you’re hardheaded, you will probably pay more money in taxes and have elevated blood pressure.
Do you have questions about your taxes? Schedule a free 15-minute Zoom call with me by clicking the link https://bit.ly/PTT_Onboarding