One of the most dreaded projects this time of year is filing your tax returns. Yes, preparing your income taxes is right up there with having a root canal, replacing gutters, fixing a flat tire, or repairing a leaking faucet. Whether you prepare your own return, or engage someone else to prepare, there is always a bit of work involved in pulling the information together. Both routes take time, energy, and focus. Unfortunately, it must be done. As Benjamin Franklin famously said, “…in this world nothing can be said to be certain except death and taxes.”

Below are some pointers to help make the tax filing process easier:

1. Confirm who will prepare: Verify who will prepare your returns and/or how. If you prepare your own returns, this may involve downloading the current version of the software to be used. If you have a preparer, you want to confirm if there have been any changes to their position—such as a new office, new company name, etc. 
2. Start gathering documents: If you are lucky, you may only have W-2s, 1099s, Social Security statements, or other IRS required documents that neatly summarize your information. Other information isn’t so neat and tidy. If you have rental properties, business partnerships, or farms, the gathering of information may be much more burdensome. I always recommend reviewing the method used in the previous year and determine if any information may be missing. Also, I recommend starting with the income sources first. The IRS always wants to make sure that income is being properly recorded. (Note: Under-reporting income is the first trigger of a tax notice.) Once you have all your income sources gathered, then focus on deductions.
3. Make notes for your preparer: Even if you are the preparer, it is important to note if there have been any changes to your situation. For example, you may have had a change in your marital status, address, or your health that has an impact on your taxes. Moving out of state makes tax preparation very tricky. Selling a home or real estate can be complicated. Depending on the circumstances, you may decide to hire a professional preparer instead of doing it yourself. 
4. Narrow down what your key issues may be: If you use a professional preparer, they will likely provide you an organizer that will guide you through a series of questions to identify when you have a situation with tax consequences. If you use tax software, it also will guide you through questions help you include the correct information.
5. Vow to do a better job next year: If you are finding the task overwhelming, what would make it better? Would it be better to have someone help you? Would it be better to organize your tax related matters throughout the year instead of waiting until it is time to prepare the return? Would it be better to work on it for a window of time today, and then pick it up again tomorrow? Breaking it down into smaller tasks will help you keep the momentum going.
6. Celebrate when the job is done: Even if you owe taxes, it is still a victory to simply have the return prepared, filed, and on its way to the IRS. In whatever manner you enjoy celebrating—perhaps enjoying dinner at a nice restaurant or a little something from Amazon—give yourself a treat when this challenging task is completed. 

We want to help you make this annual obligation as stress free as possible. So, if you need help with Fidelity information or have questions on your situation, please reach out to us. While we don’t prepare tax returns, we’ve helped clients in diverse tax situations and are always happy to discuss your concerns or reach out to your tax preparer. We are here to be of service to you.

Kristina Bolhouse, CPA/PFS, CFP®

Vice President/Shareholder

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