By Janet Ross.
Time flies, especially when you’re facing a deadline. According to the Internal Revenue Service, about one-third of Americans file their taxes at the last minute. Unfortunately, procrastination can lead to stress. Here are five tips to help comfortably manage the next few weeks for a less stressful tax season.
1. Get organized. Those two words alone sound helming, but what they really mean are “get your paperwork together.” This is not necessarily a difficult step, but it can be time consuming. Use the tax checklist at www.edwardjones.com as your guide. Set a goal to check off one or two items on this list each day. That way, no single day is overwhelming, and you’ll be well ahead of the game when it comes time to complete the tax returns themselves.
2. Decide if you need help from a tax professional. Consulting a tax professional is a personal decision. It may be worth your while if you find yourself confused during the “get organized” stage. Additionally, tax professionals can bring expertise to the table that may benefit you: knowledge of the ever-changing tax code helps them find all possible deductions and potential strategies to lower your tax exposure next year and beyond. Financial professionals often work together, so you can likely get a referral for a qualified tax professional from your Edward Jones financial advisor.
3. Make your 2013 IRA contribution. Making use of tax-advantaged savings opportunities is important. And one of the best opportunities is to fund your Individual Retirement Account (IRA) before the April 15 tax deadline. For 2013, the maximum IRA contribution you can make is $5,500 ($6,500 if you are age 50 or older by the end of the year).
4. Consider filing electronically. Electronic filing works best if you expect a tax refund. Because the IRS processes electronic returns faster than paper ones, you can expect to get your refund three to six weeks earlier.
5. Commit to reinvesting your tax refund. If you anticipate a refund, think ahead to the best way to use it. Many people choose to invest some or all of that money. Your financial advisor can help you identify investment options to benefit you and your family – your rainy day fund, a college savings plan or your retirement fund, for example. If you build a specific plan for your refund now, you’ll be less likely to let that income slip through your fingers.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.
