Get Your Taxes Done In 7 Days
How to finish your taxes in 7 days.
April 8, 2013 — -- intro:
Remember when your mother scolded you for running up the stairs two steps at a time? Slow down, she would say. You're going to trip and hurt yourself. Taking it step by step will get you there almost as quickly with much less chance of a painful fall.
As usual, mom was right. And her wise words are just as applicable to your tax-filing tasks.
When the tax filing deadline nears, folks tend to get in a hurry and rush through returns. That's a bad idea, since you're more likely to make mistakes or overlook tax breaks, both of which could cost you some serious tax dollars.
But by approaching your tax filing one step at a time and spending around an hour a day on taxes for the next seven days, you can complete your annual taxes in just a week. Here's the Bankrate plan:
1. Gather data.
2. Examine exemptions, etc.
3. Decide on your deductions.
4. Find your forms.
5. Count your credits.
6. Fill out your forms.
7. Sign, seal and deliver.
Even better, by spreading out the duties you'll save your sanity, good humor and maybe a little tax money, too. So click forward to the next slide to get started with the first day's tasks.
quicklist:title: Day 1: Gather datatext: Let's start with the name: the income tax. That means you need to gather all your earnings information.
Start with your W-2 wage statements. You should have one for each salaried job you had last year.
Don't forget any 1099 forms. These statements, each with a different suffix, will come from various sources.
You'll get some from employers if you did independent contract work. Others will come from banks and investment companies if you owned financial instruments that paid interest or dividends or you sold a stock or other property.
Are you a gambler? It's not a good idea to take chances with the IRS, so be sure to report any winnings because that money is taxable, too.
Retirees also take note. You might owe the IRS on part of your Social Security.
And tough economic times are insulation from the IRS. If you collected unemployment, some of those payments are taxable. You should have received a Form 1099-G showing the amount of unemployment; you can subtract $2,400 of that amount from the total and count the remainder as taxable income.
Find all these income statements, as well other tax-related documents you received earlier this year. Your tax tasks for the day are done.
quicklist:title: Day 2: Examine exemptionstext:
Today we start slashing your tax bill by claiming exemptions, dependents and a wide variety of adjustments to income. And this is all done on the first page of your 1040 or 1040A tax return.
First, your exemptions: On your 2009 return, you get to take $3,650 off the top for each person you claim as an exemption. That's generally a pretty easy determination: you, your spouse and any dependents, which generally means your kids. But did you care for a parent, even one who didn't live in your home? You may be able to claim an exemption for that person, too.
The key thing to remember when it comes to folks who qualify as your dependents is that you need their Social Security numbers. Without those nine digits, the IRS will disallow the claim.
Next, there are some expenses eligible taxpayers can claim directly on the 1040 or, to a lesser degree, the 1040A. These are known as adjustments to income or above-the-line deductions and include, to name just a few, certain IRA contributions, student loan interest, alimony payments or moving costs.
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