Raleigh, N.C. — Year-end tax planning almost always creates stress, but there are several ways to make filing those returns – which are due April 17, 2012 – a bit easier.
First, get tax records together in one place. The Internal Revenue Service recommends keeping tax records for three years, but some documents, including stock transactions, IRAs and home purchase forms, should be kept longer.
Another important thing to remember, especially around the holiday season when donations to charities increase, is that a taxpayer must have a bank record or a written communication from the qualifying charity to deduct any charitable donation on their tax return.
Any homeowners that made energy-saving or green-energy home improvements during the 2011 calendar year can also qualify for new home energy credits, the non-business energy property credit and the residential energy efficient property credit. Because they are both credits and not deductions, these two options reduce the amount of tax owed dollar for dollar.
Once it’s time to file, the IRS recommends the E-file method because it is a safe, accurate way for taxpayers to quickly complete theirs taxes and make certain to take advantage of credits and deductions.
If it all turns out to be too stressful once tax season gets in full swing in the spring, don’t be afraid to hire someone to help.
Reputable tax preparers will ask multiple questions to determine whether expenses, deductions and other items qualify and remind clients that they need to keep careful and complete records in order to substantiate information on their return.
In the end, however, taxpayers should remember that they are legally responsible for what ends up at the IRS in April. Make sure to find a qualified professional.