published Friday, March 25th, 2011

Winsett: Follow these tips for tax preparation

BIZ BULLETIN

By Jim Winsett

Q: What guidelines does the Better Business Bureau have for preparing to file income taxes?

A: With April 18 fast approaching, it is time to start the tax filing process that we all know and love. This tax season, if you are planning to get assistance from a tax preparer or even if you are planning to do the leg work yourself, the Better Business Bureau, along with the Internal Revenue Service, recommends following these top 10 tax filing tips.

1. Start gathering your records: Round up any documents or forms you will need when filing your taxes: receipts, canceled checks and other documents that support income or deductions you are claiming on your return.

2. Be on the lookout: W-2s and 1099s should have arrived by now and you will need these to file your tax return.

3. Use Free File: Let Free File, at www.irs.gov, do the hard work for you with brand-name tax software or online, with fill-in forms.

Everyone can find an option to prepare their tax return and e-file it for free. If you made $58,000 or less, you qualify for free tax software that is offered through a private-public partnership with manufacturers. If you made more or are comfortable preparing your own tax return, there is Free File Fill-in forms, www.irs.gov/freefile ; the electronic versions of IRS paper forms.

4. Try IRS e-file: After 21 years, IRS e-file has become the safe, easy and most common way to file a tax return. According to the IRS, 70 percent of taxpayers used www.irs.gov/efile/index/html.

Starting in 2011, many tax preparers will be required to use e-file and will explain your filing options to you. This is your chance to give it a try. IRS e-file is approaching 1 billion returns processed safely and securely. If you owe taxes, you have payment options to file immediately and pay by the tax deadline. Best of all, combine e-file with direct deposit and you get your refund in as few as 10 days.

5. Consider other filing options: There are many options for filing your tax return. You can prepare it yourself or go to a tax preparer. You may be eligible for free face-to-face help at an IRS office or volunteer site. Give yourself time to weigh all the options and find the one that best suits your needs.

6. Consider direct deposit: If you elect to have your refund directly deposited into your bank account, you will receive it faster than waiting for a paper check.

7. Visit the IRS website again and again: The official IRS website, www.irs.gov, is a great place to find everything you will need to file your tax return: forms, publications, tips, answers to frequently asked questions and updates on tax law changes for year 2010.

8. Remember this number: 17: Check out IRS Publication 17, a comprehensive collection of information for taxpayers highlighting everything you need to know when filing your return.

9. Review! Review! Review! Do not rush. Be sure to double-check all the Social Security numbers and math calculations on your return, as these are the most common errors made by taxpayers.

10. Do not panic! If you run into a problem, remember the IRS is there to help. Try www.irs.gov or call toll-free at 800-829-1040.

Remember, when seeking the assistance of a tax preparer, always get referrals from friends and family on who they use and check the BBB Business Review on tax preparation services at www.bbb.org.

For more advice on finding professionals you can trust and for filing your taxes accurately, visit www.bbb.org and www.irs.gov.

Get answers to your questions each Friday from Jim Winsett, president and CEO of the Better Business Bureau Inc., which serves Southeast Tennessee and Northwest Georgia. Submit questions to his attention by writing to Business Editor Dave Flessner, Chattanooga Times Free Press, P.O. Box 1447, Chattanooga, TN, 37401-1447, or by e-mailing him at dflessner@timesfreepress.com.

Comments do not represent the opinions of the Chattanooga Times Free Press, nor does it review every comment. Profanities, slurs and libelous remarks are prohibited. For more information you can view our Terms & Conditions and/or Ethics policy.
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