1. Prepare a central location to gather information.
Designate one place, such as a folder or desk drawer, to store documents that you will start receiving in January and February so you can easily and quickly find them.
2. Tax documents to collect.
Forms W-2, 1099s, 1098s and 1095A (health insurance form), Schedule K-1s, broker’s year end summary statements, escrow statements, charitable contribution acknowledgement letters, property tax statements, DMV renewal forms, Federal and estimated tax payment documentation.
3. Complete organizer.
Review and answer all questions in the tax organizer you receive from your CPA. The organizer will assist with identifying and organizing information needed to prepare your returns. Mark any changes (additions or deletions) from the previous year.
4. IRA contributions.
Consider contributing to a Roth IRA or Traditional IRA. You can still make these contributions up until April 15 for the previous year.
Be ready to extend if needed, but provide as much information as early as possible to allow time to calculate and estimate tax liabilities. An extension is an extension to file not an extension to pay.
Don’t procrastinate! Being organized will save you time and anxiety and sometimes even dollars!