Happy February! The IRS is now accepting tax returns for 2021. It’s that time of the year to find and collect all the necessary documents to file the taxes. Can be very time consuming. Staying organized throughout the year can save you a lot of time come tax season. Keeping it simple is always good.
Will you be getting a tax refund? Will you owe money to the IRS? Neither one is a good thing. Being right around $0 is the ideal for most people. You might have heard people say, “I can’t wait to get my tax refund!” but the reality is that you are simply getting your loaned money back. Interest free… Yup, you see, by overpaying on your taxes you gave the government an interest free loan. It’s not a bonus or some extra money that the government is giving you for free. It’s the money you already earned!
At the same time, you don’t want to owe the IRS money. Working with a tax professional can be very helpful in determining how much you should have withheld each paycheck. Or, if you are self-employed, how much you should be setting aside. This is a great time to review 2021 and make any adjustments necessary for the current year. Don't forget that the deadline to file is April 18, 2022.