Whether you like all the technicalities of making a tax plan, save taxes for the last minute or prefer someone else deals with it entirely, doing a bit of organizational planning ahead of time can make the whole process easier. Here are some of the best habits to build into your routine for both easier taxes and easier financial planning:
- Use a tool to monitor both your spending and income. The more insight you have into your finances, the better. Using a tool that collects all of your revenue and expenses is even better, especially if you have multiple sources of income and several investment accounts. This way, you can pull all of the information from one source instead of chase down accounts and hope you remember everything. Regularly seeing your spending habits in relation to your income also keeps you have a better grasp of your finances in general.
- Have a centralized physical space for tax documents, too. Not everything is online, and those can be the worst factors to track down when you’re in a hurry. Set aside a box or drawer for everything tax-related that comes in through the mail. That can include W2s that you don’t receive electronic copies of, your property valuations, and any check stubs for atypical income you receive.
- Don’t wait until the last day. That’s trite advice that everyone offers, but it’s true for multiple reasons. Even if you avoid the usual risks — such as missing documents, unclear steps, or a down site — you’re still at a disadvantage because you can’t plan out all of your options. Taking your time and googling (or asking a tax professional, for even better answers) questions can save you hundreds of dollars this year and thousands overall.
For more tax tips and habits that can help every part of your finances, contact ASAP Tax.