Don’t File Your Taxes Before Doing These 5 Things

It's that time of year again - time to start thinking about filing taxes. It may seem like a pesky task, but with the right knowledge, it doesn't have to be. It doesn't matter whether you're a seasoned pro or new to the game, understanding the ins and outs can make the process smoother and possibly more beneficial for you.

Get our free mobile app

An article from Charles Schwab has several key factors that you need to know about before you file. Sometimes you can get lost in the whole process, so it's a good idea to keep things as simple as possible. Below you'll find five things to keep in mind as you dive into your tax returns.

ALERT: DON'T FILE YOUR TAXES BEFORE DOING THESE 5 THINGS

Know the Deadlines

The most critical part of tax filing is knowing the deadline. April 15th is the day taxes are due in the United States. Missing this deadline can result in penalties, so be sure and mark your calendar.

Gather All Necessary Documents

Before you start, make sure you have all the necessary documents. This is your W-2 form from your employer, any 1099 forms if you’re a freelancer (or have other sources of income), and documents for deductible expenses. Most of these forms are downloadable from the IRS website. Getting everything together beforehand can save you a lot of hassle.

Understand Your Deductions and Credits

Tax deductions and credits can reduce your tax bill. Deductions lower your taxable income, while credits reduce your tax bill. Common deductions can include student loan interest, medical expenses, and charitable donations. Credits might include education credits, the Earned Income Tax Credit (EITC), or child tax credit. Learn what you’re eligible for.

Choose the Right Filing Status

Your filing status can make a big difference in your taxes. The main statuses are single, married filing jointly, married filing separately, head of household, and qualifying widow(er) with dependent child. Each has different tax rates and benefits, so be sure and select the one that best fits your situation.

Consider Seeking Professional Help

If your tax situation is too complex, seek professional help. A tax professional can provide guidance, help maximize your deductions and credits, and make sure your taxes are filed correctly.

Tax filing doesn't have to be a source of stress. Being informed about deadlines, organizing your documents, understanding deductions and credits, choosing the correct filing status, and getting professional help when necessary can help you can power through the tax season with confidence and ease.