3 Tax Planning Strategies To Save You Time

It makes sense to utilize tax planning strategies to save you time - any time of the year. What kind of strategies can you employ that provide a payoff in time saved? Here are three easy ones.

1. Organize

Organization is a crucial step and one that takes some discipline to implement. The idea is to corral all your receipts in one spot so that you have them readily available when you need them at tax time. Buy a flexible folder or filing box and label tabs for various receipts. Use headings such as "Auto" or "Insurance" or "Utilities" or "Food" and arrange them alphabetically. Place all your receipts in the appropriate sections.

2. Keep Track of Expenses

Other useful tax planning strategies include using an accounting software program (such as Quickbooks), or Microsoft Excel spreadsheet, to keep track of all your expenses on a weekly or monthly basis. Use the same general categories you have in your organized filing system. This way, whether you do your own taxes or have a certified preparer do them for you, you'll have documentation in hand - and well in advance of tax time.

3. Pay Ahead or Defer Expenses

It may make sense to pay your January mortgage payment in December, in order to obtain a tax advantage. Or you may wish to pay medical bills ahead of time if you will need the deductions in this tax year. Similarly, you may wish to defer paying some items or bills until next year if it is more to your advantage tax-wise to do so.

These tax planning strategies to save you time have an added benefit: they may also save you money.