First-time filers: Five things to Know About Filing Your Taxes08.12.13
If you’re a recent college graduate, new to the working world or haven’t filed a tax return before, filing your taxes on your own is something you’ll need to tackle for the first time. Completing your tax documents for the first time can seem daunting because, let’s face it, taxes are complicated. They can also seem scary because the last thing anyone wants is to be in trouble with the IRS.
If you’re a first-time filer, don’t be scared. Instead, remember the following advice to make your first solo tax season a breeze:
Get your records in order.
Getting your documents organized now can reduce headaches come tax time. Take all your piles of paper and mail and sort through them, organizing them in whichever way works best for you. Keep all income documents, as well as medical, education and job-related receipts. Organize them by category and keep them in a safe place.
Know what to keep.
It’s imperative you keep and file all expense and income-related documents, including: W-2 and 1099 forms, bank statements, brokerage/mutual fund statements, canceled checks, receipts, invoices, proof of rent/mortgage payment, insurance records and any other financial documents related to income and expenses. It’s also essential to keep records of documents to back up claims for credits, adjustments and deductions.
Choose a tax preparer you trust.
Estimates on the length of the tax code range from one to four million words. Taxes are complicated. So unless you have a background in taxes or accounting, finding a tax preparer you trust is a wise move to help you decipher the maze. Ensure your tax preparer has a current IRS issued Preparer Tax Identification Number (PTIN), has been through extensive, professional training and is in good standing with the Better Business Bureau.
Retain your records.
It’s tempting to toss records after you finish your return or get your refund. Don’t do it! Keep your records (your return, receipts and other documents) for at least three years in case the IRS comes back with questions. Your tax preparer should also keep your tax returns on file for three years and can serve as a back up to your own records.
Know how to respond.
If the IRS contacts you about your return, don’t panic. If you used a tax preparer, they can be a first point of contact for guidance and advice. In some situations, your tax preparer may advise you to reach out directly to the IRS. Jackson Hewitt’s Chief Tax Officer Mark Steber offers more insight on how to respond to a letter from IRS in his recent post on the Huffington Post. And, even if Jackson Hewitt didn’t prepare your return, Tax Pros are available year round for help.
Following these tips can you help you prepare for the coming tax season. To contact a Jackson Hewitt tax preparer or learn about preparing your taxes with Jackson Hewitt find the location nearest to you.