Tax season 2014 has come and gone and you can breathe a sigh of relief, grateful you don’t have to think about it for another year. As a taxpayer, you fall into one of two camps. Either you’re licking your wounds from writing some sizable checks to the government, or you’re paying off big debts that were incurred up until April 15th. If we take a moment to reflect on the lessons we have learned from this past year, we can plan for a better tax season next year, significantly reducing our stress during the new fiscal year. Financial planning helps us to make better decisions and ultimately keep more of your hard-earned money in your pocket, where it can come in handy for purchases and investments with big price tags (homes, cars, education) and retirement.
There is an old saying, “The only certainties in life are death and taxes.” We must learn to manage this stressor in a way that is efficient and effective. In my practice, I emphasize the importance of being proactive in tackling events that are unpredictable, uncertain, and negative. Keep the following points in mind in order to insure that next tax season will hold fewer surprises and less stress for you, your businesses, and your family.
Stay Organized
There are many tools one can use to organize tax-related transactions, including Quicken, TurboTax and H&R Block at Home. For the less tech-savvy, regular folders or boxes to organize receipts work just as well. Being organized and keeping all your expense receipts can save you thousands of dollars in deductions. Quickbooks is also another wonderful resource that enables a small business to keep up with write-offs and transactions on a daily basis. Finding a convenient place for your receipts and business expenses is critical in helping to make next year’s process that much easier.
Be Proactive!
It’s easy to procrastinate on things that seem scary or overwhelming. But procrastination is the enemy! At the root of procrastination is anxiety about failure, or the belief that the task will be overwhelming. Be proactive when it comes to dealing with your taxes and everything that comes with it. There will be fewer surprises when you are prepared. Research the resources that you may need so that you are getting the right kind of help. Choose an accountant that educates you on the process of filing taxes – if you need a recommendation for an accountant, it’s helpful to ask your friends or colleagues. It is always helpful to have your accountant create a payment schedule for you to follow throughout the year. When one follows a schedule, there is less room for surprises surfacing at the end of the fiscal year.
Procrastination causes most people to wait until April to file their taxes. This can be problematic because unforeseeable changes to your family’s financial picture or tax laws may influence how you file your taxes. It’s best to begin early, so you can make better decisions for the remainder of the year.
In order to enjoy your life and the money you make while working to their fullest degree, you should strive to be proactive, organized, and vigilant about creating a filing system that works for you for your receipts and expenses, and meeting any required tax payments on a quarterly basis in order to ward off the one thing that hurts the most – an audit! Stay ahead of the game this year, follow a schedule that allows you to stay afloat, and your accountant will take care of the rest.
To learn more, visit www.draldencass.com or call Dr. Cass directly at 646-202-9611.
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