Here we are, another year is coming to an end and that means it’s time to prepare to do your taxes.  It may not be the most exciting thing that the new year brings, but it is a necessary evil nonetheless.  However, tax preparation does not have to be dreadful event that most people believe it to be, so long as you are properly prepared.  To make things a bit easier on you, as well as your tax preparer, here are a few simple teqhniques to get yourself ready:

• Take an envelope or folder and mark it “2007 Taxes” to house all of the records you will use when filing your 2007 1040
• Make a list of all of the interest-bearing accounts you have (including checking, savings, & certificates of deposit)
• Add all of your brokerage accounts to that list
• Also incluse all lenders whom you paid mortgage interest to and all counties/taxing authorities to whom you paid real estate taxes to
• Make a seperate list of all of the partnerships or S-corporations that you have an interest in
• Each time you receive a form K-1, 1099-Int, 1099-Div, 1099-R (Retirement disbursement statement), 1099-E, or tax statement cross off the name of the payee from the list until they are all marked as received.
• Pull all of the receipts you plan to use when filing your taxes, including but not limited to: charitable donations of cash or goods, unreimbursed business expenses (gas, tolls, meals, travel, supplies, etc.), education expenses (and educator expenses if you are a qualified educator), child-care costs, documented moving or job search expenses, medical expenses, medical insurance premiums, etc.
• Call any pharmacies you use and ask for an annual account summary for the year outlining all of your prescription costs.
• Pull any receipts for large purchases made during the year, which may include automobiles, appliances or other big-ticket items (your tax preparer will know which one can be used)
• Place all of these items in the folder along with any other items that you may feel can be used as a qualified reduction to your taxable income.
• Keep the folder on your desk at all times as a reminder to keep organized and not to wait until the last second to bring your documents to your tax preparer to file your 2007 taxes.

Naturally, this is a very simplified list, everything may not apply to your individual tax situation or you may have a much more complicated tax situation.  In any case, this is just something to help get you started on the right path in filing your 2007 tax return, and not making the mistakes that many taxpayers make: waiting until the last second to file, or not being prepared and losing out on deduction due to missing or incomplete information from lack of planning and organization.  While you may benefit by requesting an extension to the filing deadline, keep in mind that you will still be responsible to pay interest on any tax liability you may have when everything is said and done.

This entry was posted on Saturday, December 29th, 2007 at 8:50 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.