3 Tips to Help Prepare for Tax Season

With tax season right around the corner, now is the perfect time to plan how to handle your federal tax returns. Here are some tips to help you prepare for the upcoming tax season.

1. Decide Who Will Prepare and File Your Taxes

If you had major life changes in the previous year - started a new business, had to claim unemployment benefits, got divorced or married - filing your taxes will be more complicated this year. Therefore, you might need to hire a tax professional or a CPA to prepare and file your taxes. Also, do not wait until the calendar flips to April to make the decision, as it could end up costing you hundreds of dollars. Instead, explore your options and opt for a tax professional according to your needs.

2. Shield Yourself from Fraud and Tax Scams

The probability of becoming a victim of identity theft and digital scams is significantly high as tax season approaches. Not only can someone file a tax return in your name, but they can also compromise your identity by stealing your credit card information or personal details. According to tax experts, the best way to protect yourself from such situations is by using the IRS’s identity protection pin. Through this program, you will receive a unique verification number that you can use to file your tax returns easily and safely. Another way to safely receive your tax payment is by opting for direct deposit, especially if you expect a refund.

3. Pay Taxes Due by April 18

If you expect to owe taxes when filing your tax returns, it’s ideal to pay as much as possible before the due date. Last year the IRS extended the tax filing deadline, but that is not the case this year. Therefore, even if you cannot pay the full amount that you owe, pay as much percentage of the tax as you can as soon as possible, as this will reduce the chances of missing the deadline.

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