What is your favorite season of the year? It probably isn’t tax season. With the time and energy spent to complete your taxes on time, it’s no wonder adults hate this yearly venture. Add to that the fact that finances are the No. 1 stressor of most Americans, and you have a recipe for anxiety. Since April 18 is the deadline for submitting your 2021 taxes, here are a few pointers in case you’re in the weeds trying to understand the difference between a 1040X and a 1040 EZ.
Start tackling your taxes early
Most experts agree that the best thing you can do to minimize tax stress is to start early. If you wait until April to begin your taxes—if you’re eagerly reading this, desperate for help, it’s obviously too late for you, so remember this tip next year!—you may find that you’re missing documents (panic!), most accountants are booked (panic!), or in your rushing to do them yourself, you miss something that could be a red flag for an audit (panic!). Procrastination just created a perfect storm for errors and elevated stress. Begin your taxes in February, after you’ve received all your tax documents. This way, you will have a few months to slowly work your way through everything.
Don’t try to do it all at once
Preparing your taxes can be overwhelming, especially if you decide to sit down bang out everything at once. Who has time for that? Or enough sanity to decipher the tax code? Instead, focus on doing a little at a time to reduce your chances of making mistakes or becoming overwhelmed by the swirl of numbers, abbreviations, and forms.
Ask for help
There are plenty of services that provide help to people completing their yearly taxes. You may want to hire an accountant, especially if you’re a business owner. Again, this is a great option if you start early, as accountants tend to book fast this time of year. If you are going to file taxes yourself, use an online or computer-based service to help you, such as H&R Block, TurboTax or FreeTaxUSA. Don’t forget that the IRS offers free online services as well for those earning $73,000 or less, available in both English and Spanish. The IRS also offers free tax services to those who qualify by making $57,000 or less, have a disability, or speak limited English.
Many accountants and tax-prep services also offer advice on how to get a better refund next year or how to set aside money to pay your taxes. Some services even allow you the option to put your current refund toward next year’s tax payment, should you want that. Either way, planning ahead will help to ease your financial burden when it comes to paying taxes the following year.
Whether you are just beginning to tackle your taxes this close to the deadline (we hope not!) or you have had them done for a few months now, take advantage of our tips to make your overall experience less stressful next tax season. Don’t procrastinate, understand your options and plan ahead to ensure you’re making wise financial decisions to help you experience less stress this time of year.