Tax season is stressful, but it doesn’t have to be. Here are a few ways you can start preparing for next tax season now so you have less stress next year.
Getting organized now is one of the best ways to prepare for next tax season. Keeping receipts in a shoebox is better than nothing, but you should step up your filing system so you can make tax time easier for your future self.
For important electronic documents, setting up email tags or folders is a great way to easily store and find those documents when you need them. This can save you hours of searching through emails and looking for that one document you need at tax time. For paper documents, find a filing system that works best for you. You can scan important documents into a specific folder on your computer. Or, if you prefer the old-fashioned way, set up physical file folders.
Separate Personal and Business Expenses
If you run a business, one of the best ways to make your taxes easier next year is to separate your personal and business finances.
With smaller businesses especially, mixing personal and business expenses can happen more easily and cause your taxes to be more complicated. Open up a separate bank account (and separate credit card if you like) and make all business transactions on the separate account. Don’t make personal transactions on this account, ever. When you go to file your taxes for next year, you won’t have to spend hours sorting through a combined set of bank accounts and credit cards trying to figure out which expenses were personal and which were business.
Review Your Prior Year Return for Tax Saving Opportunities
Your last year’s tax return won’t predict the future for next tax season, but reviewing it can help you in other ways.
It can help you figure out what tax items from last year you’ll have again next year, and looking at tax forms can help you figure out where you might have some major changes. This can give you a general idea of where you’ll fall income, credit, and deduction-wise next year. With your projected tax situation, you can also take a look at other deductions and credits you think you’ll qualify for. There may be certain deductions or tax credits you can take that you weren’t able to last year, and these could help you lower your tax bill.
Plan to File Early in 2023
Filing earlier rather than later is the smartest thing to do. If you filed a little too close to the Tax Day deadline this year, at least you can be proactive and make changes next year. Start all these planning actions now to file as early as possible in 2023. Don’t wait to file until the last minute, especially if you have all your documents and information ready to go.
When you file sooner, you’ll be able to quickly fix any issues that arise without the stress of a close deadline. You’ll also get your refund sooner, or have more time to gather money to pay the IRS or state.
Hire a Tax Professional
Some of the points above may sound extra complicated to figure out by yourself, especially if your tax situation isn’t straightforward. Your best course of action then is to hire a tax professional to help you prepare for next year’s tax season now.
They will not only be able to help you year-round and answer all your questions but a qualified tax professional will find all the deductions they can to help you save as much money as possible. They’ll also pay attention to tax law changes so they can help reduce errors when filing. Tax planning with a tax advisory firm is a valuable service that can help you with next year’s taxes and beyond. While it may not be as simple as forgetting about your taxes until next year, it can pay off in the long run by helping you keep more of your hard-earned money.
We are your trusted tax resource.
If you’re looking for a seasoned tax professional to help you make next tax season go a little smoother, Gaylor Tax Services is here to help. We are your trusted tax resource to help you with tax planning as well as future tax preparation. Our team of experts is here to answer all your questions and guide you in the right direction for financial success. No matter what, don’t hesitate to contact us. We are located in Phoenix, Arizona but can assist you anywhere in the state.