While most people don’t think about their taxes until they’re ready to prepare their returns, getting into the habit of tax planning year-round can make filing less stressful. The more information you can give your accountant, the better off you’ll be. The experienced accountants at Daren Katayama, C.P.A., L.L.C., in Kailua Kona, HI, want to help you feel confident about your next filing, so they offer the following tips to help you start the process. 

1. Review Your Documents First

Before you start calculating what you owe, examine your tax documents. Check your W-2 for errors as soon as you receive it and report any problems to your employer immediately. If you have other income-related documents, like a 1099 contractor agreement, make sure the reported income is accurate. Verifying this information will help your accountant process and file your return quickly.

2. Organize Investment Earnings

Any earnings on your investments need to be reported to the IRS, just like regular income. To simplify tax planning for your passive income, keep your investment paperwork organized all year. Read your statements when you receive them, keep them together throughout the year, and make a note of any losses you incurred. You may be able to claim them as deductions on your return.

3. Get Receipts for Donations & Charitable Contributions

If you regularly donate to a local charity or other qualified organization, you may be able to deduct the donations from your taxes. To qualify for those deductions, you need to maintain itemized records of every contribution. When you donate, request a receipt, so you can give it to your tax advisor when it’s time to prepare your filing.

Following these steps will help you take the stress out of tax planning. Working with a dedicated accountant like Daren Katayama, C.P.A., L.L.C., simplifies the process even further, giving you the confidence that your filing is accurate. Visit their website to learn more about their tax return services and call (808) 329-6635 to make an appointment.