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How to file on time and avoid late penalties

One of the most feared days in the US is April 15th! This is the deadline for most taxpayers to file their tax returns. If April 15th falls on a weekend the deadline will be the next business day.
You can always file an extension for personal tax returns to extend your filing deadline until October 15th or the next business day if it falls on a weekend. For business returns the extension date is September 15th.

What do I need to do to file on time?

Save your tax documents as they come in.

W-2, 1099, Proof of health insurance, mortgage and student loan statements, charitable contribution records, etc. Put these documents in a secure location, (the kitchen table does not count), where you will be able to locate them when it is time to file your tax returns.

Prepare your own records

Ideally this is done throughout the year but if you had extraordinary medical expenses, home maintenance/improvements, business expenses, etc. Good record keeping is key to saving the most on your tax returns!

Your bookkeeper (or family member stuck with preparing your taxes) will appreciate having good records.

If you are missing documents get the information needed.

You should have a checklist of the income you received, expenses you can deduct, etc. If you do not get all of the W-2s or 1099s you should follow up with the source to make sure they are going to get it to you.

If you have questions talk to a tax professional!

If you know you had income and the W-2 or 1099 hasn’t been received, you should: 

  • file your taxes without it, pull your ‘wage and income’ transcripts from the IRS and amend your tax return or better yet.
  • File an extension and wait for the IRS ‘wage and income’ transcripts to become available towards the end of May and then file your tax return.

Should I prepare my own taxes or use a tax professional?

This all depends on how complex your income and expenses are. 

If you are working a W-2 job(s) and are using the standard deduction: then using free or inexpensive software is just fine. TurboTax, H&R Block, Liberty Tax, Jackson Hewitt are all examples of tax preparation companies that excel at doing simple tax returns quickly and efficiently.

If you have business expenses, are self-employed, or have enough deductions to itemize, I would consider using an experienced CPA or tax preparer. The previously mentioned companies might have someone with the expertise to prepare your tax returns but often do not.

Finding a good tax preparer can be difficult – check out their reviews, get recommendations and use people that do not over-promise to get your business. If it sounds too good to be true – it probably is.

There are plenty of CPAs and tax preparers that charge similar rates to other companies and do much better work. Shop around as there are very expensive CPAs too. Make sure they have experience handling your tax situation.

The larger and more complex your tax situation is, the more experience you need. Good CPAs will refer you to someone that specializes in your kind of business. Large real estate holdings or rentals, owning a business either large or small, overseas assets or stock trading are all reasons you should probably be talking to an experienced CPA.

I cannot tell you the number of times someone used a program, company or even a CPA that did not know how to handle their tax situation. Get a second opinion and if you are not happy with your tax preparer – SWITCH! There is a shortage of good CPAs but there are plenty out there that are reasonable with their rates and do excellent work. 

At Guardian Tax Law, PLLC we refer taxpayers to excellent CPAs and tax preparers across the country so if you need a GOOD tax preparer referral – call us at 520-485-7371 or fill out our contact form here.