The tax man cometh – are you ready to file?

January 08, 2015 by Chris Rubino
$100 bill

The holidays have come and gone, footballs are filling the air as bowl games and playoffs are well underway, and it’s time to start thinking about…taxes. Yes, sad to say, it is true. The IRS has announced it will start accepting tax returns on January 20th, whether you paper file or electronically file.

If you know you have an estimated payment due on January 15th be sure that you make it. If you think you may have a large amount due on your tax return, you may also wish to do a quick estimate and make an estimated payment by the January 15th date to help limit any taxes and perhaps interest due later.

While it is understandable to want to file early in order to get your refund faster, it may be best to wait until you are sure that you have received all the “reporting” documents, such as W-2s, 1098, and 1099 forms. Employers generally have until February 2nd this year to issue W-2 forms. Some 1098 and 1099 forms do not need to be issued until the end of March. The good news is, most try to issue these forms as soon as they practically can.

A new wrinkle this year is being presented by the forms 1095. There are three types: 1095-A, 1095-B, and 1095-C. All relate to Obamacare (the “Affordable Care Act”), essentially indicating the months you and the other individuals who are or could be your dependents in your household had health insurance coverage. If you bought or were given your health care insurance through a government sponsored “Marketplace,” you will be receiving a 1095-A form. These should be issued by the end of January. The 1095-B or 1095-C (depending on the size of your employer) are optional this year, so you may not receive one at all. Next tax year these forms are mandatory, but employers have until the end of March 2016 to issue them. Therefore, there may be some folks who will be unable to prepare their taxes for the next tax year until the beginning of April 2016.

If you plan on itemizing deductions or claiming certain tax credits, you should start collecting and centralizing the information needed to do so. For instance, you can start gathering your medical bills, property tax statements, letters from charitable organizations, and the like. If you kept things like mileage logs, now is a good time to start calculating your business, personal, and commute miles driven. After you are done preparing your taxes be sure to store all of these records in a safe place.

You may also want to make a decision on how to prepare your taxes. If you self-prepare, tax software, like TurboTax, provides a private, inexpensive, and reliable way to do your taxes.

Tags: IRS, tax planning
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