Start Preparing for the Next Tax Filing Season Now

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Now that tax season is over, it is time to start preparing for next year. These simple steps can help you receive a refund next year and you reduce your taxes.

  •  Predict the future – using your last pay stub:  It is possible to do a tax projection of your taxes for the full year.  Review the withholding amount that is listed on your  paycheck stub and make any necessary adjustments. A Jackson Hewitt tax preparer can help put together an estimated projection at any time throughout the year, or can assist with amending a prior year return.

  •  Keep an eye on tax-saving strategies:  Common activities such as purchasing a new car or making home improvements may lead to tax benefits.  For example, the Energy Tax Act offers tax incentives for energy-efficient car purchases or home repairs.  If you need to replace a hot water heater, install a new a/c unit, re-insulate your home or put in new windows, or if you’re planning to buy a new car, making a “green” purchase and keeping the proper documentation can lead to savings on your tax return.

  •  Evaluate what you are saving and how:  Look for ways to participate in tax-free savings opportunities.  Many companies offer a 401(k) program, which is a helpful way to save and reduce your taxable income.  The maximum contribution amount is $16,500.   “A simple tax tip is to become involved with a 401(k) plan and to try to contribute the maximum amount,” says Steber.  “If you’ve been unable to participate thus far this year, see if contributing or even increasing your contribution for the remainder of the year might work.”  If you turn 50 this year, or are already 50 or older, you can increase your contribution by an additional $5,500.

Many Jackson Hewitt offices are open year round to help you with your tax questions and needs. 

 

Spring Tax Cleaning

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Tax season is over and it is time for spring tax cleaning!

Now is the time to purge your old tax records.  The IRS only requires you to keep your records for three years from the due date of your tax return or the date your filed your tax return, whichever is later.  In addition, we at Jackson Hewitt recommend you keep any tax return that could affect a future tax return, until the final return containing the information is filed.  This includes returns that have a sale of part of stock or mutual funds owned, businesses with an inventory and depreciation, and rental property to name a few items.

Contact the Jackson Hewitt office closest to you for any concerns, questions, or to file a tax return.

Last Minute Filing Tips

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Each year a large number of taxpayers wait until the final days to file; but we’re here to help! Whether you are filing online or with a tax preparer, keeping just a few last-minute guidelines top of mind will help you focus on exactly what to do, avoid further delay, and ensure that the last-minute rush does not negatively impact their tax filing process and financial bottom-line.

 

Answers to some key questions from last-minute filers:

 

  • How can I be sure to get my biggest refund possible? From benefits relating to life changes experienced in 2010 to new and extended tax laws, knowing which credits and deductions you can claim can help maximize a tax refund or reduce a tax liability owed. With so many tax law changes every year, working with a knowledgeable tax preparer can help to ensure you claim what you qualify for and avoid leaving money on the table.

 

  • What is my fastest option for filing? IRS e-file is not only faster than mailing a tax return; it’s also more accurate and includes a confirmation of receipt, so taxpayers know their returns have been received before the deadline. When you e-file and use direct deposit into a bank account, you can receive your refund in as little as 8 to 15 days.  Jackson Hewitt provides FREE electronic filing with paid tax preparation.

 

  • What if I owe, but can’t afford to pay? If you are unable to pay the full amount of taxes you owe, it is important to pay as much as possible to avoid a high assessment of penalties and interest. Talk to your tax preparer about the various payment options including: the IRS Installment Agreement, payment by credit card, and scheduled direct debit from your checking or savings account. 

 

  • What is an extension, and how do I know if I need one? An extension of your federal tax return is a request to file your tax return by October 17 and still be considered timely filed. Pay as much as possible, but know that to avoid certain penalties, you must pay 90 percent or more of your estimated tax liability on or before April 18. 

 

Only Two Weeks Left - Are You Ready to File?

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This late in the tax season you definitely don’t want to rush and miss tax benefits that you deserve and are entitled to. Some key ways to make sure you don’t leave anything out is to review your year for life changes (marriage, divorce, etc.), use a checklist of overlooked credits or deductions and lastly, get help from a knowledgeable tax professional.

 

If you went back to school last your, you may be eligible for the $2,500 American Opportunity Credit or the $2,000 Lifetime Learning Credit.

If you purchased an eco-friendly vehicle last year, you may be eligible for the Alternative Motor Vehicle Credit.

 

Check out Jackson Hewitt's MyTaxManager for a list of the most commonly overlooked deductions and credits.  We also provide a checklist to help you gather the information needed to make filing your tax return easier.