April 15, Tax Day, is just around the corner folks! Don Ferguson, financial expert, drops by with tax tips to keep you in the know and ready go.
1. Be ahead of the game! Make sure to have all the documents you need before filing.
- Collect all of your personal information (Social Security number, bank account and routing number)
- Find a special, secure place to keep needed documents throughout the year such as:
– Tax records
– W-2 forms (provided by your employer)
– Additional income (1099 forms)
– Car registration fees
– Medical payments
– Mortgage payments
– Losses due to theft or accidents
– Tuition payment or student loan interest paid (1098 forms)
2. Who does your taxes? You have options
– Using an accountant
- Accounting Aid Society offers FREE income tax prep throughout southeast Michigan, with 10 tax sites in Detroit. You will meet with IRS-certified Tax volunteers.
– Using an online tax program
- If you use a tax program, consider using the interview feature to help you with some of the frequently overlooked deductions or tax filing options. Here are FREE, suggested programs:
- TurboTax: includes features such as online filing, state forms, and error and deduction checks as well as “help” features to guide you along the way. The program asks you a series of questions, and based on your responses, it suggests deductions for which you might be eligible. It also offers some reminders about things you may have missed.
- It’s Deductible: allows you to track your charitable donations that can assist you in getting the biggest tax deduction possible. If you donate clothing or other household items to a charity, you may find that “It’s Deductible” can help by providing a fair market value for your donated items.
3. Honesty is the best policy
- When filing your taxes, be truthful about all the numbers you report.
- Don’t understate your income or overstate your deductions.
4. File your return on time
- If you owe taxes and cannot pay all that is due immediately, contact the IRS for a payment arrangement.
5. If you receive a notice from the IRS, respond immediately!
6. Create a plan for your tax refund
- Developing a plan for these funds helps you to take baby steps towards your life goals.
- You might want to save for a new car, pay off some bills or maybe take a vacation. Whatever the case, without a plan you risk spending it all before you reach your goal.
About the Author: Don Ferguson is the Project Consultant and financial expert for WIN Network: Detroit. He has a wealth of experience in finance and financial literacy programs. He earned his B.S. in Mathematics at Virginia State University, and completed executive education programs at Babson College, University of North Carolina, and Duke University. In addition, he is deeply dedicated to many programs and groups throughout the city, such as 100 Black Men of Detroit and the NAACP. Don’s financial advice will be featured on the WIN Network: Detroit blog.