Like many people, once the April 15 tax filing deadline has passed, you sighed with relief. If you got your forms completed on time and sent your check to the IRS, you were ready to relax and return to your normal life. After all, you don't have to think about income taxes again until next spring, right?
If this is your way of thinking, you may be missing out on ways to save money and lower your tax bill next year. This may be especially important if, like many in Oregon, you have watched your tax bill climbing in recent years.
The year is still young, and this is the perfect time to assess your tax situation. Hopefully, your copies of the tax documents you just completed are handy, and you can pull them out of the file and review what may have caused you to owe so much to the IRS this year.
If you have never investigated tools for tax sheltering, now may be the time. For example, your employer may offer a 401(k) or IRA into which you can automatically deposit part of your earnings, tax-free, before you even miss it. The sooner you can begin, the more you will have set back for your retirement, when you will likely fall into a lower tax bracket.
Doing some good
Many taxpayers wait until December to make their charitable contributions. It's natural to be generous-minded during the holidays, and with the end of the tax year around the corner, it's a good way to add a little extra to your list of deductions on your taxes.
However, starting now to make those contributions will have two benefits. First, it will give you time to investigate the organizations you want to support. Second, you may be able to make a larger contribution if you spread your giving across the entire year instead of donating in one lump sum.
Putting it all together
Perhaps one of the most common struggles people have during tax time is trying to find all those receipts, forms and documents they accumulate during the year. You may have your own stacks of these papers on your nightstand, in your brief case and on your desk. Starting a filing system now will allow you to keep those items in one safe place, organized in the manner that works best for you. You will not regret the few minutes that you spend doing this now when it saves you time and delays next April.
Finally, you can always reach out to a legal professional for answers to your questions. Whether you need guidance for lowering your tax bill or representation for an issue with the IRS, having a legal ally can help you meet your goals.