More Time to Prepare Your 2021 Tax Return
As you may have already heard, the IRS just moved the tax filing deadline from April 15th to May 17th due to the pandemic tax changes in 2020. So, you have a little extra time to prepare and organize all of your documents and receipts. When you do file your tax return you want everything to go smoothly, right? Below are 4 tips to help make sure things run smoothly when you’re ready to file your return.
- Keep all tax documents in one area. One of the main reasons that tax filing gets delayed is due to missing documents and receipts. A common missing item this year may include the new 1099-NEC Form for taxpayers such as; contractors, consultants, or those part of the “gig” economy. To prevent this dilemma, find one place in your home or office to put all your documents as soon as you receive them.
- Are you still stuffing your documents in a shoe box or storage container? All that sort of thing does it to slow done the process and increase the time it takes to prepare your return for filing. It’s time to find a better way to organize. Make it easier for yourself and/or your accountant by creating different folders for each type of receipt. For example:
- Adjustments to income.
- Business/ rental information.
- Itemized deductions.
- Tax credit information.
- A “not sure” or miscellaneous folder.
- Special event list. This list will include things like your W-2 form from your employer, a 1099-INT from your bank for interest earned on your accounts. But, did you sell your home, decide to retire, or send a child off to college? These are unusual things that don't happen each year. If you haven't written these things down, you may forget them at tax time. When you're ready to file your return, you may not have the necessary tax documents at your fingertips. This could cause a delay in filing your return because you will have to stop and look for all your documents.
- Don’t forget your signature! You may be surprised to learn that even if you electronically file your tax return, you still must sign Form 8879, which authorizes the e-filing of your return. So whether it's a traditionally-filed paper tax return or one filed electronically, a signature is required.
At Summit CPA we can assist you with all of your tax and financial needs. For more tips or assistance, contact our office at 866-497-9761 to schedule an appointment.