Once you’ve returned home from that great long-distance trip you took to celebrate the holidays and the seasonal glow begins to fade you will find yourselves coming face to face with the realities of income tax preparation. Somehow it always seems that whenever one receives presents or gifts there is someone waiting to take something away. But you can ease the bite quite a bit if you try to be prepared for the onset of the tax preparation marathon. There are simple but valuable steps you can follow to make the process easier.
First, establish and maintain records – and files – that keep track of all your purchases and financial actions over each year. You can categorize them by purpose – home maintenance, children, medical, business, employment and utilities.
Second, list all of your sources of income, and retain copies of all your payments. If you receive you pay checks electronically, like many of us do today, then retain copies of the payment notices in a separate file with the name and address and tax number of the payee. Any income from private sources should also be recorded.
Third, keep track of all your local and state income financial … Read more