Tax Prep, or tax return preparation, is a process of preparing one’s taxes. Often, tax preparation is performed for someone other than the taxpayer, typically for compensation. You can, however, do your own tax preparation with the use of tax preparation software or an online service. It all depends on your personal situation, of course. Here are some things to keep in mind when doing your own tax prep:
Prepare early. Most taxpayers receive their tax documents at the end of January. Gather all the receipts that you receive during the year so that you can claim as many as possible as deductibles. Whether you’re claiming a standard deduction or an itemized deduction depends on the kind of records you have. Itemized deductions will give you a higher write-off, so organize your receipts early. If you don’t keep records, you can get away with a basic deduction.
Streamline tax prep. There are three main ways to prepare a tax return: a tax preparation company, a virtual tax preparation service, or an online service. KPMG Spark offers full-service online bookkeeping and tax account services to businesses, making them a great option for tax prep. Jackson Hewitt offers three tax prep options: online, in-store, and in its stores. For a reasonable price, you can choose one of these three options.
Avoid the stress of doing taxes by hiring a tax preparer. A tax preparation software that feels more like an interview is better than fill-in-the-blank process. If you have a lot of paperwork, it might be helpful to import W-2 forms. This is a time-saving way to avoid having to type all of the numbers by hand. Also, try to find a software that allows you to import your tax return from a previous year.