12 April 2013

5 Things to Tidy Up as You Finish Your Taxes

They're almost upon us!
Well hello there, guess who suddenly feels like writing again? This guy! So that's what's going down now. Today being April 12 means that the "dreaded" day has basically finally arrived. For those of you who don't live in the USA, our tax return papers are due on April 15. The last two years, the date was pushed back due to a holiday and being on a weekend, but it's back in force on the 15th this year. That means that if you've yet to complete (or start!) your taxes, there's no time like the present. In the meantime, here are a couple other things that you might as well get together while you're here.

1. Organize your documents. This could be quite a stack of paper. You should have a W-2 from each employer. If you received money from a plethora of other places, gather the appropriate 1099(s). If you're reporting charitable deductions, make sure you have the receipts to support them. Ditto for any business expenses. Store everything in an orderly fashion for the off chance that the IRS wants to audit you.

2. E-file. Despite the concern of e-file ID theft, e-filing is still what I and most of my fellow Americans do. It drastically cuts down the refund time and allows less room for error on either end. You don't have to use tax preparation software to be able to e-file and it's available free for everyone. In addition to the stamp you save, you also ensure that Murphy's Law doesn't kick in on Monday. Though it doesn't mean as much if you're expecting a refund, being late means you'll get slapped with penalties and fees if you owe.

3. Update your retirement contributions. Down below, I've included an infographic (which I did NOT create!) breaking down the contribution limits and options for you. Just in case. That's because April 15 is the last day to make contributions for the 2012 tax year. However, you might also want to adjust your contributions in general. Raise or lower the frequency or amount, change funds or plans, maybe even change providers. While you have all the stuff at the ready, put it to use.

4. Review your bank information. Another place for opportunistic updating is your bank account. You might have to dig up information in or about your bank account, so this is a good time for some questions and reflection. Have they (recently) started charging fees for previously free services (e.g. teller fees, check writing fees, etc.)? Is their website/app easy to use? Can you access your money without hassle? If you answered "no" to any of those and it bothers you now could be a good time to move your business.

5. Review your cyber security. One way to minimize your risk of identity theft is to keep your documents under wraps. In this digital era, that includes making sure that your computer is secure. Seeing that no place can keep itself safe, even with staff paid explicitly to keep them safe, your chances are even smaller. However, this is a good time to figure out what you have stored on your computer and move it to a non-connected location. Since just about anything can be loaded on a flash drive or other removable media, that's a good place for prior year tax returns, credit reports, or anything else with sensitive information. You might also want to clear out your email stored on company servers. The IRS has been making it known that they want to spy on your emails and apparently they can legally do so for messages that have been opened or are older than 180 days old.

That clip is how the IRS makes me feel. Anyway, enjoi your weekend! Hopefully, you've long finished your taxes (like I have), but if you are doing them, good luck. Don't forget to give yourself plenty of time at the Post Office for the line. Although 80% of filers are e-filing now, 20% are still sending in paper returns in envelopes and will all wait until Monday to do so. Don't give Murphy a chance. Auf Wiedersehen!

Image sourced from 401(k) on flickr.

Created by Tax Code 2013
Donation Filing Max 13

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