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Smart Tips for Tax Preparation

Use these smart tips to prepare your taxes. Know what to look for when choosing software or a tax preparer.

by Navy Federal on February 15, 2018 | Tag(s): Taxes

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Let’s face it. Most of us have to pay taxes. Whether you use tax preparation software or hire a professional to prepare your taxes, these tips can help you get the job done right.

Get Organized

A crucial first step in filing your taxes is being prepared. Give yourself plenty of time to get organized before filing your return or reaching out to a professional for assistance. This makes the process less stressful and reduces the likelihood of making a costly mistake.

  • Use a tax preparation checklist to make sure you have everything you need.
  • Save forms, donation receipts and other documents in separate folders for easy access.
  • Keep track of filing deadlines.
  • Have last year’s return handy for reference.
  • Select software support or a tax preparer if you want help preparing your taxes—read below for tips on making a selection.
  • Selecting Software or a Tax Preparer

    Do Your Homework

    When choosing software or a tax preparer, protect yourself by doing your research. Tax preparation software is popular with do-it-yourselfers. You can find cloud- or computer-based options. It’s difficult to say which one is the safer option. Before making a decision, consider your circumstances.

    • How much do you want to spend?
    • Are you filing a form 1040EZ or form 1040?
    • Do you want help if you have questions completing the return?
    • Will the company arrange for someone to accompany you to a meeting if you’re audited?

    Check out reviews by NerdWallet on some of the leading online software providers.

    If you want one-on-one assistance or own a business or certain investments, look into hiring a certified public accountant (CPA) or other tax preparer. Carefully screen potential candidates. If you’re audited, you’ll be held accountable to the IRS.

    • Ask for and check their references.
    • Make sure they will accompany you to an audit.
    • Find out whether the office will be open after your return is filed in case you or the IRS need more information.
    • Watch for Red Flags

      The old saying, “If it seems too good to be true, it probably is,” applies. Be skeptical. Don’t hire a tax preparer if they:

      • promise a refund before they have actually reviewed your tax information
      • guarantee an exact refund amount after only seeing your W-2 form
      • say their fee will be a fixed percentage of your projected refund

      File Your Tax Return

      Even if you have assistance with tax prep, you may need to actually file the return yourself. The IRS recommends electronically filing your tax return. You’ll get a refund faster, using IRS Direct Deposit. The agency says it usually takes less than 21 days to receive your return when you e-file and use direct deposit versus six weeks when you send the tax return by mail. If you owe money, use IRS Direct Pay to send funds from your checking or savings account. Remember to keep a copy of your filed tax return.

      When preparing your taxes, you want to have all your bases covered. Make sure you’ve reviewed all your options and choose the best preparation method for you.

This article is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.