Business
Do taxes sound daunting to you? It may sound very tedious. But let's face it, you probably didn’t prepare throughout the year. If you haven't done anything to get ready for taxes, in this week's episode, Angela Sticca Snyder explains how you should prepare for taxes. Part One of ‘Getting Ready For Taxes’ The first thing you need to do is gather up all of your tax documents like W2s or 1099s. It's tricky because there's a lot of 1099s. Do you have interest or dividends? Do you have a new investment? A lot of them don't mail out their statements until at least middle to end of February. If they rush out, sometimes they have to be amended, which means you have to get an amended tax return done. “If you get a 1099 miscellaneous, it means it's you're getting paid for services or work you did, but you're not getting taxes withheld.” – Angela Sticca Snyder (05:03-05:12) Try not to rush your investment statement, capital gains, and losses. You might have sold some mutual funds as well. Look at your statements and make sure that there is a cost basis on there. You've got what you sold it for. But always look for a cost basis. If there's isn’t one there, start looking for it. Call your investment advisor to help you. We've done wages, interest in dividends, and capital gains. Think about student loans and mortgage interest statements. These are all documents that you're going to get in the mail or by email. If you don't get it mailed, don't think you didn't get it. Most financial institutions are having you log in for your documents. They want to get away from snail mail. Do you blame them? If you're older and don't know how to get online, or you don't have an account yet, you might have to reach out to your rep. Just because you don't get a statement, don't assume that you don't have anything to report. Investigate and check it out. Some other statements you might get if you have a Health Saving Account, or HSA. There are usually two documents that come if you have an HSA. Start gathering for it. Remember, it can only be used for medical expenses if you use it for something else. Don't do that again, because then it becomes taxable income to you. Keep any statement that says “important income tax document” or a tax return document. Part Two of ‘Getting Ready For Taxes’ If you have a rental property or if you have a small business, they probably sent you a statement. Make sure you gather up all of your rental income. Any deposit money you receive is not considered income. If you received a first and last month deposit, don't add that to your income because technically it's not yours. Hopefully, they're not going to trash your place, and get it back. “There's a way to gather up all your business expenses that will make it less difficult.” – Angela Sticca Snyder If you have to travel to that property, you might want to include that as well. If it's in a different state, gather up all of your rental and your small business expenses. If you get a 1099 miscellaneous, it means you're getting paid for services or work you did, but you're not getting taxes withheld. If you get one of a 1099 miscellaneous and there's income in box seven, then that means you're self-employed. Some people may not think they're self-employed, but they are. If you have the 1099 miscellaneous, then you're going to need to start organizing your business income and expenses. Maybe you are in an office space, perhaps some travel mileage. All of those things are deductible on your business. Now, with your small business, you need to gather up the total amounts that you've spent throughout the year. You don't want to bring to your accountant a file full of receipts. You'll be charged for having them go through it. It's a good idea for you to go through it yourself. How To Connect Taxanista is a leading certified public accountant who offers reliable professional tax and accounting services. She is a consummate strategist. She loves listening, analyzing and developing strategic plans. Do you have bigger issues? Taxanista can help you fight off the IRS. Angela knows how unsettling some of your struggles may be that’s why she offers private consultations for your business and tax matters. Increase your profit by knowing your numbers. Reach out to her now. https://www.taxanista.com/