Just to set the record straight, I never “crammed for Finals.” I’m usually a good hour or more early for a flight (check-in time, that is). And call me an old Boy Scout, but I still subscribe to the motto “Be prepared.”
Which is why I typically spend the first week in March gathering up all of my records, bank statements, W2’s, 1099’s, Mortgage Interest Paid, Bank Interest Earned, donation receipts and the like well in advance of the tax filing deadline.
I want to be sure I have everything I need to ensure a smooth, efficient and surprise-free filing.
The Advantages of Being in the Know
If I owe, I want to know. Before I have to write out a check. Also, knowing this ahead of time, you have the opportunity to potentially lower your tax liability by maxing out your IRA contributions.
You have until April 15, 2022 to contribute to your IRA for 2021 tax benefits. For 2021, the maximum contribution to an IRA is $6,000 for those under the age of 50 and $7,000 for those 50 and older. The IRS offers these handy reminders to help you make the most of your contributions. And if you participate in an employer-sponsored 401(k) plan, you should make sure you’ve maximized your contributions for credit towards 2021. Ask your employer or advisor about making 401(k) catch-up contributions.
Knowledge is power, especially when it comes to your money.
Likewise, if I’m expecting a return, I want to know. That way I can proactively plan the best use of the windfall. Even if it is just enough for a celebratory dinner at the local burger joint.
The point is you can never go wrong knowing what you can expect. Especially when it comes to your taxes. And if you do owe, it won’t be such a shock to the system as it would be if you waited till the last minute.
Purposely Brief
If you’ve read any of my previous blogs, you know I can be somewhat verbose. (Albeit, entertainingly so.) But given that there’s so much you need to do to get ready for this year’s tax filing, I’m making this month’s entry brief.
And as you’re feverishly scouring through bank statements and checkbook registers, hunting down receipts, double-checking investment contributions, chances are very good you’re saying to yourself “Never again” or “There’s got to be a better way.”
Well, I’m here to respond with “Good for you!” and “There sure as heck is!”
It’s called Banktivity. The empowering suite of personal finance software tools. With it, you can take on any and all financial goals. Pay-off debt. Save for college. Buy a house. Plan for retirement. And more!
And with Banktivity’s customizable reports, you can go from your financial Big Picture down to the most granular level of spending, saving and investing. With all of your accounts, bills, donations in one place, you can easily pull together everything you need for fast, efficient and simplified tax filing.,
Whether for personal use, your small business or both, Banktivity brings your complete financial world into focus. With it, you’ll always know what’s coming in, what’s going out and where it’s going to.
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