No More Tax Procrastination

Will all of the last-minute tax filers please step forward? Good. Read the following 'no procrastination plan' to learn how to file taxes in a timely fashion.

It's time to break the old habit of waiting until the last minute to prepare and file taxes. Procrastination is understandable for those individuals who will have to pay additional taxes, but there's no excuse for preparing the tax forms on April 14th. It's better to be prepared and not file rather than have to file and not be prepared.

Here is a 'no procrastination plan' to avoid the last-minute tax preparation rush:

1. Create a tax folder: As early as January 1 of the new year, create a file for which all tax-related items will be inserted. Don't procrastinate; make it a habit to include this little activity as a New Year's resolution. The mere action of creating a tax file brings the tax preparation process from the subconscious to the conscious mind and moves it up on the 'to do' list.
2. Make a checklist: Pull out last year's tax returns and make a required forms checklist. List the institutions that sent W-2, 1099's, interest statements, etc. for last year's tax returns. Use the list as a base line for this year's tax preparation forms checklist. If there are additional items that have occurred during the year that will add or detract from the list, add or remove it from the checklist. Aim to have this step completed by mid January.
3. Keep the checklist up to date: As the tax-related mail comes in, cross it off the checklist. When all items are received and checked off the list, it is a good time to begin working on the taxes. Unless there are special circumstances (like an employer going out of business), according to the IRS, taxpayers should receive their tax forms by January 31st. However, if February rolls around and the checklist still shows outstanding items, it's time to follow up for the missing documents. If all goes well, this step should be completed by January 31st or the first week in February.
4. Obtain the necessary tax preparation software or find a reputable accountant to handle the job: Although tax preparation software has made it much easier for individuals to prepare their own taxes, not everyone has the time or the desire to do so. Now is the time to decide which software to purchase or which accountant services to utilize. Aim to complete this step by the second week in February.
5. Start working on the taxes (or make an appointment with the accountant): It's good to start working on the taxes as soon as all of the tax documents are received. Some people prefer to tackle it all at once, while others can only stomach tax documentation a little at a time. Either way, don't put it off. Now is the time to make the appointment with the accountant or start loading the information into the computer software. The closer it is to the tax deadline, the scarcer accountant appointments become. Don't procrastinate when it comes to making the appointment. Make it a goal to have this step completed by the end of February.
6. Add the finishing touches: Look over the taxes one last time; make sure they're correct. If the tax forms reflect the good news of a tax return, run to the post office or quickly get online and file the taxes immediately. On the other hand, if the news is not so good, this is the one time it's okay to procrastinate. Wait until April 14th, or for those who live life in the fast lane, April 15th, to file the taxes and send the appropriate payment.

Since there's no way to get around the chore of filing taxes, it makes sense to make it as painless as possible. Setting a schedule and adhering to it will make the process manageable.

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