[Source: Article on MSN.com, 2007, citing the IRS and tax consultants]
- First of all, if you're reading this now, better hurry and submit an extension by midnight. The referenced article appeared in early December.
- Claim the correct filing status, as of Dec. 31. You could lose credits and exemptions.
- Double-check for correct Social Security number - for every person included in the filing.
- Use correct forms and schedules. Avoid a po'd computer in the bureaucracy.
- Sign the return. Date the return. Unsigned = unfiled = uh-oh, not good, very bad.
- Claim only eligible dependents. Criteria are strict. This one isn't as simple as it sounds.
- Use or lose your earned-income credit. A mess to determine. Thanks, Congress.
- Keep receipts in a box, drawer, file, somewhere. Keep them for benefits of deductions, and keep them for proof in audits. Biz expenses, charity, health, taxes, mortgage, et al.
- Report the hired help. You owe payroll taxes for nannies, homecleaners, caregivers, et al.
- Report all income, every dime. W-2, 1099, cash payments, tips, gambling wins, prizes, interest, et al.
- Check on AMT - literally, Alternative Minimum Tax, but also infamous as Awfully Mean Tax. Only for you high-income folks who must tend to add-backs, flat rates, and different deductions because you wiped out too much liability the regular way. If your, or combined, income exceeds $100,000, look at the AMT.
Additional tip from Be of Good Cheer dotcom:
Speak to your financial advisor and tax consultant about purchasing or adding to an IRA before you file, giving you an additional deduction. With the allowable amount of money, either pay yourself down the road, or pay that money to the IRS now.Now then, click here to get a running start on your 2008 tax strategies to file in 2009.