April 15 is Wednesday. Don't panic. You can do it. I know because I'm in the same boat.
I've spent the last few hours sorting through my documents -- and yes, finally downloading some 1099s from my online accounts -- and putting things in order so that I can plug it all into my tax preparation software.
It is daunting. I don't know why I wait so long every year. And, yes, most years -- probably this one, too -- I'll file for an extension.
You don't have to do as I do, though. You still have plenty of time to get your return done.
Here are five things that will help you do just that.
1. Check last year's return
Pull out your copy of your 2013 tax year filing. If you're like most of us, things haven't changed that dramatically over the last 12 months, so this is a good framework of what to expect on your 2014 Form 1040. If, however, you're life got more exciting -- you had a kid, bought a house, got divorced, moved for a new job -- then you prior year return also will help you see exactly what kind of changes will affect this current filing.
2. Make sure you have all your documents
You do have all the tax-related documents collected in an easy-to-access place, right? If not, gather them up now. You might have to, as I just did, download some things like 1099-DIV or INT forms from your online accounts. Once you have the material, sort it according to where it will be reported. I like to take over our TV room, spreading the documents on the floor and annotating them with Post-it notes.
Even if you use tax software, it's handy to have the 1099-DIV, 1099-MISC, W-2, mortgage interest and property tax material together to enter as the program instructs. This tax-filing checklist can help you see if you're missing anything.
Don't forget about Obamacare. Most folks will simply check a box on our tax returns. But if you bought Affordable Care Act mandated health insurance through a state or the federal exchange, you need to make sure you have your correct Form 1095-A. You need this document to reconcile any advance premium tax credit you got at time of purchase or to claim it now.
3. Update your software
If you are using tax software, sign on now even if you're not ready to start filling out the forms. Chances are that since you loaded it onto your machine, the manufacturer has updated stuff. It could take a while for the updates to load. Nothing is as frustrating as getting ready to finally do your taxes and then having to wait for the forms etc.
You won't have to mess with this step, though, if you use Free File. The IRS-tax software manufacturers' partnership is open to any taxpayer whose adjusted gross income is $60,000 or less. Just got to IRS.gov, click the Free File link on the home page and get busy filing!
4. Check out possible tax breaks
If you are, however, waiting for your software, take advantage of the time to check out tax breaks you might be able to claim. Heck, even if you don't have to wait, do this anyway.
Yes, I know that the computer program will likely find these tax deductions and even-better credits -- for example, these 12 tax credits that reduce your tax bill dollar for dollar and might even get you a refund, for you. Still, I like knowing what's available just in case. Plus, we humans still need to stay as up to date as our machines!
If you itemize, you're probably familiar with the standard Schedule A items. Some folks, however, might be able to deduct private mortgage insurance, which is still an option for 2014 returns. And if you had a lot of medical expenses last year, you might finally be able to break that 10 percent of adjusted gross income barrier; if you're not quite there, check out the other deductible health care related expenses that might help you finally claim this deduction.
Nonitemizers and itemizers alike also should spend some time checking out the adjustments to income section of Form 1040 or 1040A. These above-the-line deductions offer a lot of ways to reduce your income, which should then help reduce your tax bill. In fact, many of them regularly make the perennial lists of commonly overlooked tax breaks.
5. Review mistakes not to make
Another way taxpayers typically cheat themselves is by making filing mistakes. Before you start filling out your taxes, review the common filing mistakes. Some seem incredibly simple, such as bad math, but they can be incredibly costly if you make them. It doesn't matter if your mistakes are innocent ones of omission or more questionable, intentional ones. Don't make any of them.
So know what to avoid in the first place. Then look at the tax error list again before you submit your tax return to make sure none of them are there.
Extension time: OK. Tax time just keeps on ticking away and you realize that you are just not going to get that 1040 to Uncle Sam by April 15. Fine. File Form 4868 to get six more months, until Oct. 15, to finish your tax paperwork. This will help you avoid a late-filing penalty.
Remember, however, that this is an automatic extension to file, not an extension to pay any tax you owe. Send that amount in with your 4858, or as much as you can. You can do so electronically, using one of the many IRS e-payment options, including the new Direct Pay method, which doesn't require any pre-enrollment.
There, feeling better about your taxes now? I'll let you get back to them and we can compare notes on how it went on April 16.