2020 DIY TAX ORGANIZING TIPS

DISCLAIMER: This post is sponsored by H&R Block Online. All reviews and opinions expressed in this post are based on my personal view. I am not a tax professional and you should always consult a tax professional for all your tax questions and concerns.

Getting a jump on tax planning and preparation will save you time and money in the long run. The current tax filing extension due to COVID-19 allows us to get the most out of our tax preparation. Although the tax filing deadline has been extended, it’s best to still file and get your refund faster, as most people need the money now more than ever. However, if you’re not ready to file just yet, rather than waiting until the last moment, missing out on opportunities for using specific strategies, and stressing out about the process, start organizing and preparing your taxes now (but don’t delay you need a refund now). But first, let me share my tips on how to make organizing and completing your taxes easy, affordable and a total DIY.

TIP ONE: KEEP ALL TAX DOCUMENTS IN ONE PLACE

One thing that can cause you to dread filing your taxes is having to filter through all of your paper clutter to find the documents needed to file. This is such an easy problem to resolve:

  • Have one binder or folder for all tax documents. I keep a binder for each tax year. As materials arrive that I need in preparation to file my taxes, I place them in binder. Using a folder can work just as well. It is essential to make sure that your tax binder is easily accessible.
  • Within your binder keep all your documents sorted by category. Example, all w2’s together, 1099’s together etc.
  • Place your previous years tax return in your current years tax binder. This makes for a great reference tool.
  • Keep a tax log. A tax log is a great way to ensure that you received all of the documents needed to file your taxes. Place this log in the front of your tax binder.

TIP TWO: DO-IT-YOURSELF

My office is located next to an accountant’s office. During this time of year they are usually busy. Of course that is not the case this year with the need for everyone to stay socially distant. This makes for the perfect opportunity to do-it-yourself. The cost-effective way to do this is by using H&R Block Online. It allows you to easily file your taxes from your smartphone or a computer.

As a professional organizer, in my mission of living a beautiful life and helping others do the same, I am always on the hunt for four key things to start:

  • Order
  • Function
  • Money savers
  • Time savers

By focusing on these four things it makes many of my decisions a simple process. When H&R Block Online approached me about working with them, I went straight to my list.

ORDER & FUNCTION

Their website is very user-friendly. I was not intimidated one bit! As soon as I hit the site, it was clean and straightforward. I also respect the fact that they are very transparent. Right from the start, you see pricing, options, and customer reviews for each solution under their DIY service. There are no frustrating pop-ups or ads. Descriptions for each service were concise and made it easy to select the appropriate filing service.

MONEY & TIME SAVER

This was huge for me. As a small business owner (and during such difficult times) I found that H&R Block Online is at least $10 less than TurboTax. I also found that H&R Block Online offers excellent value in tax preparation. One thing that I love is that they have online assistance (from actual human beings) for anyone who is needing a little help as they complete their filing. Instead of getting a help menu that is often not helpful and a time-wasting effort, they have on-demand chat service with highly trained tax experts available for DIY filers.

TIP # 3: DON’T FORGET YOUR PETS

No, that is not a typo. You know how much I love my two pups Bentley and Albert, so of course I am going to take this opportunity to include them in my tips. But seriously, May is National Pet Month and I thought it would be the perfect time to share tax some pet-qualifying tax deductions:

  • Moving a pet. Moving expenses that involve a pet can be deducted in some instances. The move has to be work-related, and there has to be at least 50 miles between the new job and your old home.
  • Guard animals. If a dog is used as a guard animal for your business, then some expenses can be deducted. Expenses related to caring for the animal are deductible, and it’s important to save all receipts to show how much they cost. The IRS will allow a percentage of the cost of care to be deducted, depending on how much time the animal spends on guard duty.
  • Pets related to work. Jobs that involve animals are eligible for some tax deductions. Are you a professional dog breeder? Do you love to race horses? Are you a dog walker who purchases supplies to care for the animals you watch? Depending on your job, you can deduct some expenses.
  • Service dogs. Households with service dogs used for therapeutic purposes may be eligible for tax deductions. Guide dogs and service dogs fall into this category. The IRS requires careful documentation, so save all your receipts, bills, and veterinarian notices. These deductions go on the medical expenses form. Food and leashes are some of the common items that can be written off. Trips to the vet and training are also frequent deductions. The actual cost of buying the service dog or guide dog is also included.

Here are two bonus tips:

  • Fostering an animal for a charity allows households to take the cost of caring for the animal off their income. The charity has to be a 501(c)(3) nonprofit and registered with the Internal Revenue Service. The animal shelter can provide paperwork proving that your household is fostering animals. Items like pet beds, food, leashes, medication, vet visits, and others are eligible for deductions. The IRS may ask to see receipts, so it’s important to save all of them and keep them separate from other pet-related files to avoid confusion.
  • Sales taxes. States with sales taxes can play a part in writing off some of the cost of caring for a pet. According to the IRS, filing Schedule A and deducting state sales taxes can help some pet owners. The sales taxes include the cost of pet food, supplies and other items purchased throughout the year. Local sales taxes, which differ from state versions, also qualify for Schedule A. Saving your receipts is essential, but the IRS allows you to use Schedule A without them. The optional general sales tax tables let you calculate the deduction on a worksheet. In addition, the IRS has an online sales tax deduction calculator.

Friends, I hope that you found this information helpful and a money-saver for you this tax season. Be sure to take advantage of my 25% discount on all H&R Block Online solutions. This is the perfect time before we get back to our day to day hustle to get a major item off of your to-do list. Hugs and Love, Nikki


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