What to Do in September to Prepare for Tax Season | Pine & Co.
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What to Do in September to Prepare for Tax Season

By September 18, 2017 Taxes, Accounting
prepare for tax season

Are you the kind of person who always has their ducks in a row? Do you consistently keep track of financial records and have a filing system even the most adept CPA would be jealous of?

Even if you do, this is for you. If not, this is really for you.

Most people are, simply put, busy. With the hustle and bustle of daily life come all sorts of minor complications that often keep you from staying on top of your financial game.

We understand, and that’s why we’re here. If you haven’t been preparing for the 2018 tax season by keeping track of your finances throughout 2017, it’s not too late. Here are some pointers for becoming proactive and getting those records ready for tax season.

1. Begin to prepare for tax season now by meeting with your tax pro soon.

If you don’t yet have a tax professional lined up, set up a consultation with one now.

September is a good time to check any last-minute issues with your tax preparer before you start getting ready to file in the new year.

Most people don’t start thinking about their taxes until after the tax year is over. That means they don’t provide their financial data to their CPAs until well after January 1st. As a proactive CPA firm that endeavors to partner with clients to stay ahead of the game and find all available tax-saving opportunities, this isn’t our favorite scenario.  

Here’s why: Once the tax year is over, there is little we can do to reduce clients’ taxes. Every taxpayer is different, and there are no “magic bullet” tax deductions that apply to everyone. However, if given an opportunity to meet with you before the year is complete, and with all the relevant data at our fingertips, we have a better chance of finding opportunities that will allow us to take action before the end of the year. These opportunities will result in real tax savings, which means more money in your pocket.

Meeting with your accountant now is especially important if you’re in the market for a new CPA or have a very new relationship with yours. It’s a good idea to get to know your accountant (and for them to get to know you) so they have a better idea of how to best assist you.

The thing is, when your accountant has more time to help you prepare, he has more time to draw up the strategy that will save you the most money.

2. Start asking questions

This is the time to ask any questions you may have, even if they don’t seem directly related to the upcoming tax season. Are you on track to meet your retirement goals? How might any new investments change your filing process? Will you have the same deduction opportunities as last year? We strongly believe that when it comes to tax planning, the only dumb question is the one you don’t ask!

Also, you will definitely want to address questions related to any major life changes. Although they might seem personal, you should notify your CPA of any drastic developments that have occurred since last tax season.

Did you welcome a new addition to your family? Did you change jobs or have a significant salary increase or decrease? Perhaps you went through a divorce, or have a divorce that is impending? These are all things to address with your tax professional now.

Your CPA is up to date on the most current laws and regulations pertaining to taxes and finance in general. As a result, he or she is the person who can best advise you about how these matters affect your bottom line.

3. Get your paperwork organized.

It’s a scenario we’re all familiar with: it’s the day before your filing deadline and you’re scrambling to get things in order, sifting through random receipts, and worrying yourself sick.

Have I missed anything?

Did I do anything incorrectly?

What happens if I made a mistake or forgot something?

One of the most important reasons for meeting with your finance professional now is to prevent this kind of tax-time anxiety. With such scenarios, all too often we see clients determine on their own that they don’t have enough time to get all the details before the deadline, so simply put, they end up leaving money on the table with the IRS and miss deductions they were fully eligible to take. 

If you haven’t already, get your paperwork in order. From receipts to bank statements, make sure you have everything organized by type, sorted (usually by date), and stored in one place.

Not sure what you need to be keeping track of? Here’s a Tax Preparation Checklist courtesy of TurboTax. Wondering about an item not included in this list? If you’re not sure whether or not you should keep it, keep it. Better to be safe than sorry.

4. Decide on a system.

Whether you’re a tech aficionado or prefer to do things the old-fashioned way with paper, pen, and spreadsheets, you should decide on a system that works for you and stick with it.

Remember all that paperwork we just mentioned? You should not only have it all rounded up in one place, you should actually have it organized to save you (and your accountant) from a major headache.

If you hate keeping paper files, scan or photograph your documents and keep them in a password-protected folder on your computer. This includes any documents you receive electronically, such as a bank statement you received by email. Create a password-protected tax folder in your email system and store everything you might need for tax season.

Word to the wise: be careful about storing your files digitally. Always ensure your files are backed-up on an external or cloud-based drive. If you keep paper records, store them in a locked, fireproof safe.

5. Keep an eye out for important tax documents.

Now that you have a system in order, keep up with it. It’s easy to receive a financial document in the mail and then throw it in a junk drawer or in a pile on your desk, but resist that temptation.

The holidays will be here before you know it, and we know it can be tempting to throw all of your important financial documents in a desk drawer to deal with later. But if you file these documents as you receive them, you’ll know where they are later and won’t be overwhelmed by the pile of miscellany you created over time.

6. Get in touch with us now.

People don’t always choose to take advantage of various tax break opportunities since they don’t always realize the opportunities even exist. And we’ll be honest – it’s rare when a full analysis of your situation won’t present tax planning opportunities.

But as a proactive CPA firm, we strongly believe you should at least be aware of all your opportunities to be certain you didn’t miss any potential tax-saving strategies.

how to prepare for tax season

Overall, it’s just better to be knowledgeable now than to roll the dice and hope you aren’t missing tax deductions later.

We’re here to help.

Learn more about our tax services and then set up a year-end tax planning meeting with Pine & Company CPAs. We’ll help you learn about your tax-time options before it’s too late.

You can get in touch with us here or give us a call at 817-581-3223.