What is it?
As the name implies tax preparation is a process that involves preparing tax returns. Therefore, to say that it can be a confusing prospect is an understatement. In order to ensure that your tax returns are filed properly you need to have the proper documentation at hand.
In other words, attempting to file taxes without documenting your expenses and income is akin to flying blind without a safety net to break your fall. You will need to keep the following in mind come tax time –
The Pitfalls of Poor Tax Preparation Kissimmee
One of the most obvious and damning aspects of not keeping your documentations in order is that you might miss the chance to deduct expenses. Failing to do so will not make them appear on your tax returns unless you have properly documented them.
You might also suffer financially if you happen to be audited and have not filed the appropriate tax preparation documents. Most IRS auditors aren’t sympathetic to such forgetfulness. In other words, if you do not document your expenses they did not exist.
Some of the ways in which you can prevent a bad audit and keep all of your expenses in check are as follows –
Gather all Work Related Receipts
If you bought an item for work like a uniform then the price for that item is deductible if the employer does not reimburse you for it. If you happen to own your own business then the items you purchase to promote it will be deductible as well. These might include –
- Computer systems
- Manufacturing Equipment
- Advertising fee
In other words, it pays to save all of your receipts whether you are self employed or employed in another company.
These will include mortgage statements, any paperwork that documents home improvement projects or home equity lines of credit. You will also need copies of any canceled checks or receipts if you rent a home in a state which offers credit or deductions to renters.
Saving any receipts or financial documents that are even remotely connected to any medical expenses will help you more than you think when it comes to tax preparation. The paperwork might include prescription costs, mental health counseling, dental work, alternate medical treatments as well as over the counter medications to name a few.
The IRS encourages corporations and individuals to donate to charity in exchange for deductions for any donated goods. In order to take advantage of this an individual must include the receipts of any items that are to be donated along with the tax return. Taking pictures of the items is not mandatory but they might come in handy if the IRS decides to contest any deduction during an audit. Documents that can be saved in this regard might include bank or credit union statements, cancelled checks or credit card statements. Documents other than these like personal notes are no longer acceptable to the IRS.
For any questions about tax preparation services in Kissimmee, or any other tax services in Kissimmee please contact us at 407-344-1012.