Organizing Paperwork Makes Tax Time Easier

By: Horizon Bank Last Updated: January 3, 2014

save-on-taxesRather than waiting until a few days (or the day!) before the tax-filing deadline, start organizing your paperwork now. After all, the earlier you file, the earlier you’ll get your refund — if you’re entitled to one. And if you end up owing the IRS money, at least you can file on time and avoid paying late filing penalties.

So let’s get started!

  1. Gathering your income documents — W-2 forms from your employer, dividend and interest statements from deposit accounts, brokerage statements, tip statements, etc. Separate the ordinary income information from any capital gains/losses information from investments.
  2. Gather deductible expenses — receipts for charitable donations, unreimbursed medical expenses, mortgage interest statements, property tax statements and any other deductible. Don’t forget to tote up mileage to and from medical appointments and charitable activities. If you work from home, you may be eligible to deduct home office expenses as a percentage of your homeownership costs. In that case, include copies of utility, phone and Internet service provider bills, as well as household repair bills and rent or mortgage payments. To learn more about deductible expenses, visit www.irs.gov.
  3. Gather any other information you’ll need — your Social Security number; account number(s) for directly depositing your refund, if any; the previous year’s tax return; and passwords if you are using online tax preparation software that you’ve used in the past. Once you have your information at your fingertips, it’s easy to go step-by-step through the necessary tax forms.

E-filing is efficient and easy

E-filing can help you complete your return, avoid common errors and get your refund faster, especially if you choose direct deposit. Plus, you can choose to have your refund directly deposited into up to three financial accounts. For direct deposit to your Horizon Bank account, please provide our routing number and your 7-digit account number.

The IRS offers free federal tax filing using online fillable forms, a useful option if you are comfortable filing your tax return completely on your own. In addition, many tax software companies offer free federal tax filing programs that guide you step-by-step, and some support state tax returns as well. Income limits apply, however. To find out more, visit www.irs.gov/efile.