Last Minute Tax Preparation
November 28, 2010, By Steve Thompson 0 comments
In theory, you've got plenty of time to prepare your taxes each year. In reality, life gets in the way of even the best-laid plans. Taxes are probably my least favorite activity in the world, and not just because it means the government is taking a sizable chunk of my income. I also hate it because taxes are tedious and time-consuming and consequently get put off until the last minute.
If you're the kind of guy who pulls out shoeboxes full of receipts on April 14, hoping to finish your last minute tax prep and slide in just before the deadline, there are a few ways to ease the strain of this time crunch.
Let your accountant know. If you use a CPA for your taxes, try to let him or her know in advance that you'll be racing the IRS deadline down to the wire. Some accountants will charge an extra fee for last-minute tax preparation, but it's worth the cost if you get the benefit of your CPA's education, experience and fastest work.
Avoid hefty software. There is a learning curve to using tax prep software, I've discovered, which means you have to learn how to navigate the computer program as well as the twists and turns of federal income taxes. Not a scenario conducive to last-minute tax prep. I've used TurboTax Deluxe in the past, and it's a great program, but don't use it for the first time when you're under a tight deadline.
Free File is your friend. If you're lucky enough to have an easy tax return to file, Free File from the IRS is a godsend for last minute tax prep. It's easy to use, but you can only take advantage of it if you earned less than $57,000 (as of 2009).
Stay in your comfort zone. If you're used to hiring an accountant, stick with your CPA. If you prefer tax software, go that route. Last-minute tax prep is not the time to explore new territory, especially with complicated returns. If you need it, file an extension.
Collect your materials. You'll find that last-minute tax prep goes a lot easier when you have everything you need in front of you. Before you sit down at the computer or in front of a stack of forms, collect receipts, investment data, proof of charitable donations and anything else you'll need to accurately prepare your taxes. That way, you're not hopping up every five minutes to dig through your files again.
Do it all at once. I work best when I set my mind to a task and work it beginning to end ... When you're preparing your taxes at the last minute, set yourself up in a comfortable place where you can work in peace and quiet, and commit to finishing your taxes before the day is out. Arm yourself with a fresh pot of coffee and hang a do-not-disturb sign on the door.
But take breaks. Last-minute tax prep means working with a whole lot of numbers, not to mention instructions printed in tiny type. It's hard on the eyes and on the brain. So give yourself a break every half-hour or hour to rest your eyes, walk around and clear your head. You'll actually get it done much faster this way.
Get some help. It could be your wife, your dad, your neighbor, your best friend—if you're not using an accountant, you might still need assistance from someone who is familiar with tax prep. Now's the time to cast your net and reel in anyone with a financial background. Preferably someone who owes you a favor.
Last-minute tax prep can be exhausting, so learn some tax secrets this year and start preparing earlier next tax season.
