Business News

5 steps to success within the tax season

The tax season is here. Prepare now to avoid any unwanted surprises on April 15th.

Free book preview Tax and legal playbook

Get breakthrough solutions to your small business questions.

January
30, 2021

3 min read

The opinions expressed by the entrepreneur's contributors are their own.

Even if you think your tax situation is straightforward, getting started can help you avoid unwanted surprises right away.

When should I submit?

The tax deadline for most individual taxpayers ends April 15, 2021 with no extensions. If you suspect you will need more time, you can file an extension that will give you until October 15th to submit your return.

Related: 4 questions to ask yourself during the 2020 tax season

How will I submit?

Some taxpayers are able to file their federal tax returns for free. The IRS works with several taxpayer electronic filing providers who earn less than $ 72,000 per year.

If you have a more complicated tax profile or prefer the guidance of a tax professional, consider the services of a Public Accountant (CPA) or other tax professional when completing your tax return.

For those who did not receive the incentive – or received less than the full amount – your tax advisor can help you determine your eligibility for the refund credit.

Gather your tax records

The IRS requires that all tax documents, including W-2, 1099, and 1098, be stamped no later than January 31 of each year.

Make a list of what you expect to receive. If you haven't received your documents by the first week of February, you can contact the financial institution for help in resolving the problem.

Maximum retirement contributions

If you haven't exhausted your traditional or ROTH IRA, you still have time. You have until April 15 to make contributions for the 2020 calendar year. Taxpayers can contribute up to $ 6,000 (plus $ 1,000 for those aged 50 and over) through 2020.

If you are self-employed, you have until the due date, including renewals (October 15), to contribute to any self-employed retirement accounts you may have.

Your tax advisor can help you determine your contribution eligibility.

Related: How does the new stimulus package affect you?

Watch out for tax fraud

Tax season spawns unscrupulous companies and individuals who will contact you and impersonate the Internal Revenue Service for access to your refund or personal information.

It is important to note that the IRS will never contact you by phone or email initially. Also, the IRS does not ask you to buy gift cards or similar items in order to make tax payments. Do not click any links that may appear in the body of the email.

The IRS will only contact you through the U.S. Postal Service if you contact them. If you haven't received any correspondence by email, be aware that anyone who contacts you by phone or email is likely a scam.

You can report these people to the Internal Revenue Service at phishing@irs.gov.

Related Articles