If you are paralyzed about tax time, here are a few ways to get started and unstuck.
Items you can get off the internet if you don’t have the papers you need.
- Use your year end credit card statements. These are already categorized for taxes.
- Go online to your mortgage company and download your mortgage expenses and property tax for your 1098. Property taxes and mortgage expenses are the biggest deductions in Texas.
- Use your online pay stubs to find the taxes you paid on your final paycheck for 2010.
- Visit your online banking and print statements out needed for income and expenses.
If you have papers, but are overwhelmed and not sure where to start.
- Go through your papers and mail to find all the 1099s, 1098s and any other envelope marked important tax document on the outside of the envelope.
- Spend one hour sorting income and expenses. Spend 30 minutes sorting income into interest and dividends and then stocks for capital gains. Spend another 30 minutes sorting medical into doctors/dentists, labs, eyeglasses, out of pocket and deductibles. Spent another 30 minutes sorting charitable deductions. Spend another 30 minutes using ItsDeductibleonline.com to tabulate your charity non cash donations. Finalize with 30 minutes of wrap up.
- Group your credit card and other receipts by categories for your small business, such as advertising, meals (with the name of who you worked with and the work you did written on the receipt), office supplies, mileage and educational expenses.
The hardest thing about taxes is getting started! Just do it, jump on it, get help with a professional or tax software, and you will be very glad you did!