March 12, 2012
Tax return assistance

Before Filing Your Tax Returns, Follow These 7 Tips

The deadline for filing your 2011 tax returns is about a month away. If you haven’t started work on your returns or haven’t filed yet, it pays to keep in mind these important tax-saving, money-saving, and stress-saving tips:

File electronically.

Say no to money advances, refund anticipation checks, and other financial products with high fees. By choosing to file electronically and receive the refund via direct deposit, taxpayers may receive their refunds in as little as seven to 10 days after they file.

Find free tax-return-preparation help.

Prepare and electronically file your return for free at community tax sites across Colorado. The Front Range campus in Westminster participated in the Tax Help Colorado program, where our students prepared free tax returns for 250 families. The Westminster site is closed now, but other tax assistance sites, including Volunteer Income Tax Assistance at Front Range campuses in Longmont and Fort Collins, are still open.

Claim your tax credits.

Claim all the credits available to you. These four credits can be especially valuable to working taxpayers:

  • Education credits: These can reduce the amount of taxes you owe and potentially give you up to $1,000 back.
  • Earned Income Tax Credit: For tax year 2011, the maximum credit for a household with three or more qualifying children is $5,751.
  • Child Tax Credit: This is potentially worth up to $1,000 for each child under the age of 17.
  • Child and Dependent-Care Tax Credit: This can help reduce the amount of taxes you owe.

Stay organized.

Good organization is key! Keep your tax documents in order. As you receive tax forms in the mail, keep them together in one place.

Avoid penalties.

Even if you have a tax due, file electronically to avoid the late-filing penalty. If taxes are owed, a delay in filing may result in penalty and interest charges that could increase your tax bill by 25 percent or more.

Call for help.

Call a 2-1-1 helpline to find the location of a free tax-return-preparation site near you. You can also visit www.piton.org/eitc or this Internal Revenue Service page.

I hope you find these tips helpful for you in filing your 2011 returns. Now also is a good time to start getting organized for filing your 2012 returns in 2013.

What tax-saving tips do you have?

About the author:

Kevin McFarlane is a member of the Accounting faculty at Front Range Community College. He is a Certified Public Accountant (CPA) and Chartered Global Management Accountant (CGMA) and a member of the American Institute of Certified Public Accountants (AICPA). Kevin has extensive experience working in corporate accounting and information systems.

Comments:

May 14, 2012 Janet

Kevin,

I agree with your points but I would stress the need for every tax filer to keep up with records throughout the year. Using one of the free or low-cost computer programs is a great way to stay organized throughout the year (if one will keep it up to date). Also, make sure there’s one place for all the paper receipts. Staying on top records (computer or paper) makes it so much easier for the taxpayer and his/her accountant come tax time.