As I write this blog, we are in the final days of this year’s tax season. As with most tax seasons, it has been interesting. Some things I noticed:
The tax code is becoming more and more complicated.
With the complication of the tax code, it is vitally important to have a tax professional in your corner. Someone who is:
- Committed to pursuing continuing education.
- Committed to providing you with the best possible service.
- Committed to making the best use of the tax code for your individual circumstance.
- Available throughout the year for questions and concerns you may have.
People fear the unknown.
This fear sometimes grips folks so tightly that they just don’t file their tax returns. It may be because of a situation they are in or they fear they owe taxes.
Late tax returns: If you haven’t filed your tax return, talk to a tax professional about getting your return filed, even if it will be late.
- If you are due a refund, you may not have any penalties.
- If you owe taxes, you can pay it when you file your return.
Unable to pay the tax due: If this is your situation, you have options through the IRS.
- Short-term extension to pay.
- Installment agreement.
- Offer in compromise. Talk to your tax professional – they can help you with this process. Go to https://www.irs.gov/uac/What-if-I-cant-pay-my-taxes for more information.
Many people are unaware of different options they have to reduce their taxes.
- Contribute to an IRA or other qualified retirement plan such a 401(k).
- Contribute to a Health Savings Account. For more information on HSAs, check out my prior blog https://crystalfinancialplanneromaha.com/what-is-a-health-savings-account-hsa/.
- Make payments on those student loans (the interest you pay is deductible).
- Keep track of your charitable contributions, both cash and non-cash.
- Keep track of your employee expenses that are not reimbursed by your employer:
- Union dues.
- Special clothing.
- Unreimbursed mileage.
- Education expenses required by your employer.
- Professional memberships.