Tax season isn’t something most people look forward to, particularly if they suspect they owe money. However, a few tax prep tips can make the process of filing a return and, if necessary, paying back taxes as pain-free as possible.
1. Call your tax preparer early. If you use an accountant or another tax preparer, be sure to book the appointment as soon as possible because slots fill up quickly. You don’t want to wait until the last minute and find there are no remaining appointments.
2. Establish a tax preparation folder. Beginning in January, certain documents will arrive in the mail that will be needed to file your taxes. Documents include earnings statements, banking interest statements and documents indicating investment profits. When items arrive, stash them in your tax folder so you’ll have all necessary paperwork at the ready.
3. Avoid tax scams. As tax season draws near, tax scammers target unsuspecting individuals. You may find that you receive calls or texts from those purporting to be with Revenue Canada. However, financial experts say that Revenue Canada will never call you on the phone; their mode of contact is via Canada Post. Another scam is individuals advertising a bigger refund when you use their services. This is not how tax laws work nor is it possible to get a return larger than what is owed. Avoid anyone promising a bigger return.
4. Utilize tax software. If you’re not using an accountant and have a relatively cut-and-dry financial situation, modern tax software can be an easy and inexpensive way to do your taxes. These sophisticated programs ask a series of detailed questions and the entire process can be completed in relatively little time.
It’s almost time to get income taxes in order. Certain tips can make the process go more smoothly.