Tax Time: Prepare Smart, File Fast

Every year, many Americans find themselves scrambling to beat the deadline on Tax Day. With these tips, you won't be one of them.

By Navy Federal February 5, 2015

If thinking about income taxes has about as much appeal as a root canal (apologies to dentists everywhere), there’s hope. You can make the process faster and less painful by getting organized now.

The 1-2-3 solution

Start by labeling three folders (you could also use electronic folders, but it’s likely you’ll get some of this information on paper) and filing documents in the appropriate folder:

  1. Income:

    • W-2 forms from employers (you should receive these by Jan. 31)
      • Servicemembers: If you believe you’re entitled to tax-free combat pay, but it’s not reflected on your W-2 form, ask your service branch to issue a corrected form.
    • A record of tips earned, if any. If your job earns tips, consider recording all of your tip information in a tip diary or keeping copies of receipts that contain tip information.
    • Social Security and pension income statements, if retired (you should receive these in January). Note: Pension income—including most military pensions, as well as distributions from traditional individual retirement accounts—is generally federally taxable. Up to 85 percent of Social Security income may be taxable if your total income exceeds certain limits—see IRS Publication 915.
    • Dividend and interest statements from financial institutions and 1099 brokerage statements (you should receive these by mid-February)

    Did you sell investments in a taxable account during the year? You'll need to find the basis (usually, the original cost of your investment) to determine whether you have a capital gain or loss for the year.

  2. Deductible expenses and credits:

    • A list of charitable donations (you must have receipts for amounts above $250)
    • A list of unreimbursed medical expenses. They may be deductible once they exceed 10 percent (7.5 percent for those age 65 or older) of your adjusted gross income (AGI).
    • A list of miscellaneous expenses, such as certain job search and unreimbursed employee expenses and tax preparation fees that exceed 2 percent of AGI (see Publication 529)
    • Records of state and local income taxes paid (from your W-2 form or estimated payment records if self-employed)
    • Records and receipts for any tax credits to which you may be entitled, such as child or dependent care, earned income, education costs and adoption costs

    Do you own a home? Include interest paid on any home mortgage and home equity loans, as well as property tax statements, to this folder.

    Do you have a home-based business? Include copies of utility bills, phone and Internet bills, household repair bills and rent or mortgage payments. You may be able to deduct a percentage of your homeownership costs or use a simplified method.

  3. Taxes paid and personal information

    • A record of your federal income taxes withheld, from your W-2 form (if you’re self-employed, a record of estimated taxes you may have paid during the year)
    • Your Social Security Number and those of your dependents
    • Routing and account numbers for direct deposit of any refund (you may receive your refund within 21 days or less with electronic filing and direct deposit*)
    • Previous year’s tax return (according to the IRS, you should keep tax records for three to seven years, depending on the situation)

    If you plan to use online tax software that you used when you filed last year, have your login and password available.

Filing is quick and easy using filing software. It will walk you through the process with prompts to help ensure you get all the deductions and credits available to you. And, with your Navy Federal account information at your fingertips, we’ll help you get organized in time for the April 15 deadline.


Navy Federal members are eligible for discounts on several Equifax® products that can help you monitor your credit, alert you to potential fraud and help you recover from identity theft.

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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.