Almost no one looks forward to doing their taxes at the end of the year, or the start of the next new one. There have been changes to many of the laws so figuring your 2010 tax may take a bit longer than your 2009 year taxes did. It goes without saying that preparing personal, or individual, taxes are far different from those for businesses or corporations. The changes for each will be different too. For either one you need to make sure you have all the documentation required before you begin. There is nothing more frustrating than trying to do your family taxes only to find that you are still missing one of your yearend statements for either wages or interest.
If you are in the habit of doing your own taxes, and you have not had any major issues with getting them done correctly, then knowing what the changes to the laws are is about all the new work you will have to do. If you have a computer program for preparing your 2010 tax return, and you have the same employer and other basic information from the previous year, this will save you a lot of time. While there are over 20 changes to tax law for personal returns, most of them are simply an increase in the amount you may deduct for each. The limit for itemized deductions has been done away with, so you can deduct to your little old heart’s content, so long as you can prove the deduction that is. The amount of the earned income credit has also been raised, so if you qualify for that you should see an increase in your refund, if any. Even the amount for your standard deduction has increased, so compare that carefully to any itemized deductions to see if you really do need to itemize, many times you do not.
If you do not feel comfortable submitting your 2010 tax information over the internet, and with all the security breaches that have been reported this would be understandable, you can still do them the old fashioned way and mail them in and wait for your paper check to arrive in the mail. Just remember it takes about a week for the snail mail to get your papers to the IRS, about a week before a human looks at them, up to one month for them to verify all the information, another week to print the check, and then the time the land mail takes to get it to you. This is the best case scenario, if you mail everything in before the second week in February 2011. If your information gets in during the peak times, or right on April 15th, it can take up to 6 months for everything to get done and you to get paid.
If you are responsible for doing corporate taxes, or you run a business with lots of expenses, accounts receivable, employee wage taxes, depreciation, and anything else you can think of that goes with your business, it would make good sense to do one of two things; either hire a professional tax preparer (if you do not have one on staff already), or get a computerized tax program that is targeted to businesses like yours that can help you find all the things you need to list. This does not mean you have to submit it over the internet, but it makes things so much easier, and helps to prevent the possibility of an audit down the road. Most of these programs come with a guarantee that says if you get called in for a review, they will also go with you to help explain what was done and why. In some cases they may even send a lawyer with you to make sure none of your legal rights are compromised.
The bottom line is to make sure do not knowingly, and willingly, either hide information or try to falsify any of your numbers to try and either avoid having to pay in more, or get a refund when you might not be entitled to it. Just keep it real and honest, and make sure anyone who helps you does the same. Then you can stop worrying about your 2010 taxes and enjoy the rest of 2011.
