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Tax season is here, and if it is your first time filing or your filing status has changed, you may be afraid of completing your taxes. You do not want to face the penalties that come with making mistakes on your tax return, which is why it is so important to make your tax season as easy as possible. You do not have to be afraid of filing taxes if you take the necessary steps to make it simple. Continue reading below to learn more about five tips that will make this tax season a breeze for you if you are scared.
1. Use a Tax Calculator
The first thing you should do after you receive all of your necessary tax documentation in the mail or online is to use a tax calculator. Input the information you know into the appropriate fields, press whatever submit button is available, and see how much you can expect in taxes. There are many options of Canadian tax calculators that are available to you to use which are perfect for small business owners. When you get the amount at the end, you will have a general guideline to understanding how much you can expect to receive in taxes so you can easily know if you have made a mistake.
2. Consider Deductions
You may be afraid of doing your taxes because you may be afraid of how much you owe. Do not be afraid of this, however, as there are many tax breaks and deductions that could be available to you. These could include deducting the interest on your mortgage and student loan payments, tuition reimbursements, charitable donations, childcare costs and more. If you own a business, you can even deduct business costs such as the mileage you use for business travel, internet costs, and mobile device costs to name a few.
3. Do Not Forget the State Tax Return
Everyone remembers to do their federal tax returns, but it can be easy to forget to complete your state tax return. This is due at the same time as the federal return though. There may be tax credits that are available just for your state return as well that can help you in saving how much you owe to the state you live in. These could include vehicle registration fees, tax fees for your home and vehicle and many more that you can find on your state’s website.
4. Start Before the Deadline
The deadline for completing your taxes is typically in mid-April. Whatever you do, do not wait until the last minute to file your taxes, and try to start them as early as possible. If there are mistakes on your return or if you are missing documentation, you can make the fixes that you need to in ample time without having to rush because of the end of tax season. You can even add contributions to your IRA without worrying about missing the deadline if you do not wait until the last minute.
5. File on Time
Despite the fact that you should not wait until the last minute to file your taxes, please make sure to file your taxes on time. There are many tax providers, including the IRS themselves, who can help you in filing your taxes for free so that you do not have to worry about the costs. Use an online service if you want the process to one as simple as possible though. If you file late, you can receive penalties on your taxes and can receive interest on how much you have due to your taxes.
Although you need to complete your taxes in the next few months, it is nothing that you have to be afraid of. It can be quite simple to complete your taxes when you use online service providers and when you start early. Be sure to use a tax calculator as well so you can ensure that you are on track with the money that the calculator provided once all information was inputted. Finally, be sure to research any deductions available at the state or federal level so that you do not miss out on ways you can save.