Early to Fed, Early Return-Wise

Taxes. Does the word leave a bad taste in your mouth? If it’s not paying them, it’s the hassle of getting all your records together so you can prepare them...so you can pay them. Ugh. But millions of Americans will be looking past the unpleasant aspect of preparing their taxes this year because there’s a dividend at the end of all the meticulous work, a 2010 tax refund.

If you think you’re in line for a refund this year, it’s to your advantage to get your tax return in as early as possible, and that means getting a head start on preparation. As we all know, the hardest part of most any project is getting started. Here are a few pointers to help you get your tax prep in order:

• Now’s the time to collect all your data. Receipts. Forms. Statements. You should have everything you need to file by the middle of February. You’ll need W-2s from your employer(s) and statements from your broker and financial institution along with 1099 forms for interest, dividends and stock sales. Your mortgage company will send you a 1098 form to show any interest and real estate taxes you paid.
   
• Get a system going so you can organize things by IRS categories. One way is to use envelopes to separate each income/deduction category, such as job expenses, interest paid, medial expenses, charitable contributions, etc. This is very helpful if the IRS declares an audit for you. You’ll have the numbers (the proof) all ready to go!
   
• If you have an accountant or service that does your taxes for you, now’s the time to call them and set up an appointment.
   
• If you do your own taxes, get things started. Open the tax program or get out your form and put pen to paper. Start by just filling out your name and personal info. It’s a start. You’ve got all your info in order (right?), so filling out the form(s) is the easy part.
   
• Don’t let all that early bird hard work go for naught. Mail your return early as well! Or better yet, e-file! It makes the whole tax process go much more quickly. More than 95 million taxpayers e-filed in 2010.

If you e-file, you can track your return with the IRS on their website. (This service will be available starting January 3.)

It can tell you whether they’ve received your return, if it’s been processed and/or if your return has been sent to you. Use the IRS website, or you can call 800.829.1954.

And don’t forget, Vantage has TurboTax software available. Vantage members receive a 10% discount on TurboTax Online Deluxe.