How to Get Ready for 2008 Taxes

Everyone gets a little more stressed or annoyed during tax season, but that does not have to include you. Procrastination is the main problem people have with taxes and I have seen people wait until the last minute and then end up with a refund and I just wonder why they waited. So here are some tips to get you through phase one and be ready once it is time to file, who knows maybe you will be in the lucky half this year that gets a refund.

Difficulty: Easy

Instructions

Things You'll Need:

• Tax Forms (W2, 1099, 1098, etc)
• Receipts from charitable donations
• Medical receipts (if you had a major medical issue that exceeded 7.5% of your income)
• Any other document you think might relate to taxes

1. Find a spot to store all your tax forms so they stay together. You probably have started receiving various tax statements from banks, employers, mortgage company, stocks, etc. Rather than just putting them where ever they fall find one location and keep everything together.

2. Find your receipts for all the donations you did this year. Both cash and drop off donations count. Most charities do pick-ups in larger neighborhoods and often left you with a receipt on the mailer. Make sure the date and amount/type of stuff you donated is filled in so it will be easier to file later.

3. Go to the IRS website (http://www.irs.gov/newsroom/article/0,,id=202106,00.html?portlet=7) and read about new changes for 2008 and see if any apply to you that you had not thought about before and make sure you have any new documentation you are not used to collecting.

4. Decide if you are going to do you own taxes or pay to have them done.
   The IRS provides free filing through many tax companies for individuals with an Adjusted Gross Income of less than $56,000 this year - http://irs.gov/app/freeFile/jsp/index.jsp?ck). Most of those companies will try and get you to buy into their tax check to check for errors and maximize your refund which is kind of a way to go in between paying someone and doing it yourself.
   If you choose to pay to have your taxes done remember you are still responsible for the accuracy of the information so you still collect all the information and check it over when the forms are completed.

5. If you also have to file state taxes make sure the tax program you are using will make that part easy as well because you don't want to have to go through the whole process twice. Of course if you are fortunate enough to live in a state like Alaska, Florida, Nevada, South Dakota, Texas, Washington, or Wyoming then you don't have to worry as you do not have state income tax.

6. My personal feeling is if you are eager to get a refund wait until the new economic stimulus package is passed in the next week or two as it could have some additional tax savings for this year.

Tips & Warnings

• If you are filing taxes yourself and can't find where a form goes, do not file until you call the tax company your are using or the IRS to find out where it goes because if you don't report something it is much more likely that you will get an audit.
• Use the irs.gov site as it does have all kinds of information, every tax form and the instructions to go with them
• I am not a tax expert, just a consumer that got frustrated paying someone to type in the same information I could do myself in less time and not pay any money.

Resources

• The official IRS site