I know 2009 has not ended. Obviously you have not received your W-2, 1099s or mortgage interest and real estate tax statement. Over the holidays, though, there some things you can do beyond the normal gathering and organizing to make your 2009 tax return preparation a little easier. If you are one of the few and brave who prepare their own tax return, now is the time to line up your tax return preparation software. There are plenty of efficient, cost effective options available. All you need to do is find the right one for you. Whether you self prepare or use a paid preparer, consider whether any of the following issues should be addressed now rather than later.
Having receipts to prove your tax deductions is obviously very important. Certain expenses such as charitable contributions greater than $250 and meals and lodging greater than $25 must be supported by receipts in order to be deductible. Now may be a good time to gather these receipts and if not available, request duplicates. You can also use this time to determine and finalize capital gains and losses for the year. You may want to call your broker before the end of 2009. Once an employee receives their final pay stub, he or she should review it first of all to make sure it is understood. In case there are any errors, your employer will have time before form W-2 is issued to correct these errors.
Inevitably, for some people there are certain issues that must be addressed before they can file their tax returns. It may be possible to reduce the April 15th stress by attempting to resolve these issues now.. Your filing status may be one of these issues. Married taxpayers may have to decide whether they want to file a joint return with their spouse or use the status of married filing separately. This involves many issues and April 15th is no time to make this decision. Similarly, if the dependency exemption between spouses and ex spouses has not been determined there is no advantage in delaying this discussion.
Another way to reduce stress is to decide now whether to make an IRA contribution. While the contribution does not have to be made until April 15th, you can avoid last minute potential problems by making the deposit now. If you employ at home domestic help, depending on the amount, you may be required to withhold and pay federal income and employment taxes. If you have not done so already, you need to discuss this with your employee now rather than later.
Finally, if your withholding and estimates for 2009 are not enough you can catch up somewhat with a January 15th estimate. State taxes paid by December 31, 2009 are deductible for 2009 even if due when filing your state return.
Having receipts to prove your tax deductions is obviously very important. Certain expenses such as charitable contributions greater than $250 and meals and lodging greater than $25 must be supported by receipts in order to be deductible. Now may be a good time to gather these receipts and if not available, request duplicates. You can also use this time to determine and finalize capital gains and losses for the year. You may want to call your broker before the end of 2009. Once an employee receives their final pay stub, he or she should review it first of all to make sure it is understood. In case there are any errors, your employer will have time before form W-2 is issued to correct these errors.
Inevitably, for some people there are certain issues that must be addressed before they can file their tax returns. It may be possible to reduce the April 15th stress by attempting to resolve these issues now.. Your filing status may be one of these issues. Married taxpayers may have to decide whether they want to file a joint return with their spouse or use the status of married filing separately. This involves many issues and April 15th is no time to make this decision. Similarly, if the dependency exemption between spouses and ex spouses has not been determined there is no advantage in delaying this discussion.
Another way to reduce stress is to decide now whether to make an IRA contribution. While the contribution does not have to be made until April 15th, you can avoid last minute potential problems by making the deposit now. If you employ at home domestic help, depending on the amount, you may be required to withhold and pay federal income and employment taxes. If you have not done so already, you need to discuss this with your employee now rather than later.
Finally, if your withholding and estimates for 2009 are not enough you can catch up somewhat with a January 15th estimate. State taxes paid by December 31, 2009 are deductible for 2009 even if due when filing your state return.
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