Friday, September 29, 2017

Filing Taxes Made Easy by DeeDee Nguyen, CM 107 September 2017

            Filing Taxes Made Easy
Public Domain

            Every January, when all the excitement of the Holiday season has come to a close, I would make a mental list of what I need to accomplish for the upcoming year.  Unfortunately, on every years list is the dreaded task of filing my tax return.  Although April 15th is still four months away, Id grimace knowing that it will creep up on me, faster than I would have liked.  For years, because of procrastination, Id go into panic mode the week taxes are due; Ive waited, yet once again, to do something that shouldve been done months ago. 

            Over the years, my tax returns got more complicated, as there were more items that I needed to report.  Waiting till the last minute is not an option anymore.  Many people I know opt to file for extensions every year.  The ripple effect of postponing the inevitable has to be a detriment to the mind and body.  Is there a better way?  Yes, we can be more organized!

            Because the whole tax process has become increasingly painful, Ive developed a few systematic techniques to make it quite bearable.  It has helped me to be more organized; Im hoping it can help you, too.

            At the beginning of the year, Id create an Excel spreadsheet which would contain all the information that is needed to file my tax return.  I would have a column for salary, amount of taxes paid (income and real estate), retirement contribution, health savings account (HSA) contribution, charitable contributions, bank account interests, investment dividends, medical expenses, work expenses, and school expenses.  Id fill in the information as I received it throughout the year.  I would also make individual labeled folders for all the above mentioned categories, in order to keep the receipts, bank statements, and salary stubs organized; this way, I could pull up the information quickly if needed.  The spreadsheet is extremely useful at the end of the year because, I can check for any discrepancies by looking at the numbers on the spreadsheet and comparing them to the numbers on the tax documents that would come in the mail every January.  Once Im assured that all the information is correct, I would give it to my accountant for use in filing my taxes. 

            By taking about ten minutes a month to file and work on the spreadsheet, I would save tons of time and stress later.  Presently, my tax returns are completed and mailed by the end of February.  I can breathe much easier knowing that I have a system in place which helps me to be diligent.  Its still so easy to procrastinate, as there are many other activities that I would prefer to partake in, but I keep reminding myself that if I can avoid doing it at the last minute, it is better for my soul.  I still have friends who choose to procrastinate on their taxes.  It would be on their mind all year long, and sometimes thats all they could talk about; in addition to that, they are grumpy, to say the least, when the deadline is about to approached.   My advice to them is this; implement a plan, any plan; or better yet, use mine to help you be more organized.

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