TAX
SEASON’S OVER-NOW WHAT
Now that you’ve filed your income tax return, you can put the folder away and forget about taxes until next year. Right??? ------ Wrong!! As previously explained in past articles, tax planning is a year-round activity if you really want to pay the least amount of taxes possible. Because things change daily in our lives that could affect our finances, the time to act is when an event occurs, not afterwards when it is often too late. Being proactive rather than reactive could help save you tax dollars down the road!
Marriage, divorce, moving, a new job or career change, the birth of a child, the death of a family member, a pay increase or decrease, loss of employment, starting a new business, retiring, an inheritance, a sudden monetary windfall, going back to school, funding your child’s college education, an illness or injury, cashing in investments, making new investments, a bankruptcy, child day care costs, are just some of the many events that have an impact on our financial lives.
The best place to start is with the tax return you just filed. Did you owe money or get a refund? What could have caused this? Did you incur IRS penalties and interest charges? If so, why? Did you have to amend your tax return? Again, if so, why? Did you receive a notice from the IRS? The point is to analyze your return and look for potential problem areas or areas of opportunity.
Some common checkups
are as follows:
If you moved, file a change of address with the IRS.
Review
your withholding allowances with your employer to b
If
you hav
Set
up or review your book keeping system to b
If
the IRS sent you a notice, b
As best as you can, try to keep current with the tax law changes that happen each year to avoid potential pitfalls and to take advantage of tax saving opportunities.
With a little planning throughout the year, next year’s tax season should go smoothly and maybe help keep more of your hard earned money in you pocket.
Editors Note: