Today in 1923, Robert Frost wrote what is arguably his most well-known poem, "Stopping by Woods on a Snowy Evening."
Even if you don’t know the complete verse, you probably know its closing lines about miles to go and promises to keep.
That’s how many of us are feeling right about now, with the
Each of us too often has a tendency to look at a daunting task like taxes and push it aside … again. Don’t.
I’m not saying you have to sit down this weekend and finish your 1040, but you can do some preparatory work so that when you do decide file, the process will go more smoothly.
So for today’s tax tip, hare are five easy steps to help you get your tax filing going.
1. Organize your tax documents.
You have all those year-end tax statements stashed in a box. That’s good. Now make it even better by sorting them. Put your income statements (W-2s, 1099s) together; do the same with investment statements, your charitable gift documentation, your home-related write-offs (mortgage interest, property taxes). If you’re self-employed or did some contract work on the side, make sure you’ve also got all your related expenses that will help reduce this taxable income. Now, not April 14, is the time to be going through your appointment calendar and MapQuesting your business trips to make sure you have all your deductible mileage.
2. Review last year’s filing.
If you’re like me, you sometimes have trouble remembering what happened last week, much less last year. So a review of what you put on your 2006 Form 1040 will help make sure you don’t overlook something this year. Since you’ve just organized your documents, if you note, for example, a missing investment 1099, you’ll have plenty of time to get a replacement. Your old form also should have all the Social Security numbers, e.g., your spouse and children or other dependents, that you’ll need.
3. Look over the forms.
Even if you plan to use tax preparation software, it’s helpful to look at the actual tax form you plan to use. In fact, look at all of them. You might find that this year you need to "graduate" from the 1040A to the long 1040. All the computer programs fill the forms out, but not necessarily in line-by-line order. However, if you know something’s on the 1040, such as the residential energy credit (line 50), you’ll have that information ready when the software asks you to enter it.
4. Decide where you want your refund to go.
Yes, even people who get refunds put off filing. If that’s you, think about having your refund directly deposited. Again this year, you can have your tax cash sent straight to up to three accounts. Pick your deposit destinations and get the account and routing numbers for each.
5. Take control of your taxes.
Not to get too Zen here, and I apologize in advance to all practicing Buddhists if I oversimplify your faith, but you need to step back and take a breath when it comes to taxes. Don’t panic. Don’t blame, either yourself, your situation or your tax adviser.
Just accept that you have to do this job and then get to it.
Whether that’s doing it yourself, on paper (yes, some people still do this), using your PC and tax software, or turning it over to a professional, take the first steps now. The sooner you get to it, even these simple preparatory stages, the sooner you can quit worrying about your taxes and get on with more fun things.
Me, I’ve done steps 1, 2 and 3. So I’m going to eat lunch and then meditate on some spring training baseball games and NASCAR qualifying this afternoon.
Calligraphy representation of Enso by Kanjuro Shibata XX.
