Documents in Portable Document Format (PDF) require Adobe Acrobat Reader 5.0 or higher to view,download Adobe® Acrobat Reader.

Online Banking

What can we help you find?

Tips For Preparing For Your Taxes

Benjamin Franklin famously quipped that the only certainties in life are death and taxes. And it’s probably a certainty that no one enjoys doing their taxes. However, there are ways to make tax season less stressful. Follow these tax preparation tips to get ready for this year’s filing deadline and to get ahead of the curve for next year.

Get Your Documents in Order

It may sound too simple, but getting organized is one of the best tax preparation tips we can give you. Whether dealing with paper documents, digital files, or a combination of both, starting off on an organized foot will make the whole process less stressful and save you a panicked last-minute search for lost documents.

To get started, designate a place for your tax documents. This doesn’t have to be fancy–a simple paper folder or file folder on your computer will do. Then, keep all items related to your taxes in one folder (or paper items in the paper folder and digital items in the computer folder). This includes:

  • Income statements such as W2 forms and 1099s
  • Financial account statements (did you know that CSB.eStatements can be sent to another recipient such as your accountant?)
  • Statement of HSA Distributions and receipts for medical expenses
  • Statement of mortgage interest paid and any other real estate tax bills or receipts
  • Charitable donation information
  • Capital gains and losses
  • Statement of childcare expenses
  • …and other relevant documents for your tax return!
It’s never too early to start your folder and you may want to keep one close by year round for random things that come in.

Decide Who Will Prepare and File Your Taxes

Another important tax preparation tip is to choose an accountant or other authorized tax preparer well ahead of the tax filing deadline. Of course, some people choose to prepare their own tax returns but, if you decide to outsource your taxes this year, here’s what to consider:
  • Anyone with an IRS Preparer Tax Identification Number (PTIN) can be a paid tax return preparer. This includes CPAs, attorneys, and tax preparation companies like H&R Block and Liberty Tax.
  • However, different types of tax return preparers have different levels of skill, education, and expertise.
  • A key factor in deciding who will prepare your taxes is understanding how complicated they are. For example, if your tax return is fairly simple and straightforward, you probably don’t need a CPA to do your taxes.
  • Check a tax preparer’s qualifications and history before hiring someone.
  • Understand how they get paid–will it be a flat fee, a percentage of your refund, or an hourly rate?
  • Schedule an appointment in advance or ask when the deadline is to submit your materials for on-time filing.
  • Review your completed return before signing it. Confirm the routing and bank account number for your direct deposit.
  • Make sure the tax preparer has signed your return and included their PTIN as well.

Filing By Yourself

If you are single with few or no deductions, no dependents, and file a 1040EZ form instead of the full 1040, you can easily file your return by yourself. Here are some different options:
Turbo Tax: Free and paid options available. Free version does not charge per state filings.
TaxAct: Free and Paid packages available. Free package does charge for state filings.
TaxSlayer: Free and paid versions. Free version is for very simple returns only.
H&R Block: Free and paid options available. Free version does not charge per state filings.

Working With A Professional

On the other hand, some people have more complicated tax situations or simply don’t want to be burdened with completing their own returns. If you have had major changes in your life recently, such as getting married or divorced, having a baby, starting a business, or you have a diverse portfolio of investments, you may want to consider working with a CPA or tax professional.

If you’re working with a tax pro, you’ll want to gather your documents and meet with the professional sooner rather than later. A professional tax preparer will need time to review your tax information and documents and reach out with any questions.
Of course, tax season is also the busiest time of year for CPAs and other tax professionals. Schedule an appointment in advance so you know they will be able to fit you in. There also may be a deadline for when you need to submit all your paperwork, such as at least a month before the filing deadline.

Low-Cost Assistance Options

If you need help with your taxes, but can’t afford to pay for professional tax prep, there are alternatives available such as:
  • Tax prep chains like H&R Block offer free or low-cost services depending on the type of return you are filing.
  • The Volunteer Income Tax Assistance program (VITA) is made up of IRS-certified volunteers who offer free basic tax preparation and e-filing to people who earn less than $57,000 a year, are disabled, or speak limited English.

Determine how you will file (if married)

Married couples can choose between filing their federal income returns jointly or separately. While filing jointly is usually the best option for most spouses, there are a few scenarios when filing separately may be better. For example, someone with a lot of out-of-pocket medical expenses may have an easier time reaching the threshold required to qualify for medical deductions with only one income. Another scenario could be someone with federal student loan debt who is on an income-based repayment plan and only wants their income to count. If you have questions about filing jointly or separately, talk to a CPA who can help you determine the best option for you.

Review Your Previous Returns

Whether you are filing yourself or working with a CPA, it’s a good idea to have last year’s taxes handy. Some of that information may be the same for this year, which allows you to easily copy it over. Reviewing the previous year’s return can also remind you of something you may have forgotten or let you know that you still need to pull a certain document.

Don’t miss out on Retirement Contribution Deductions

Unlike with 401ks, you can make IRA contributions for the current tax year up until the filing deadline. So, you have until April 18, 2023 to make a 2022 IRA contribution. Take the opportunity to max out or get closer to maxing out your IRA contribution, especially for Traditional IRAs with tax-deductible contributions. Eligibility for contributing to a Roth IRA is based on your income, so take a minute to review the current income limits and make sure you’re still eligible.

Make Sure you Took Your IRA Distribution

Unlike the contribution deadline, the deadline for IRA distributions is December 31st of the tax year. If you have an IRA and missed your yearly RMD (required minimum distribution), contact your financial provider right away.

Recognize When You Might Need An Extension

If you know you cannot get your taxes filed by the deadline, file for an extension as soon as possible. However, you will still need to pay any taxes owed by the deadline or you may owe interest and penalty fees.

Go Digital With eStatements!

One more thing you can do to take the stress out of gathering your financial documents is to go paperless as much as you can. Sign up for estatements to get your tax statements faster. CS Bank customers can also sign up to have their statements sent to an additional recipient such as an accountant. Learn more and enroll in Online Banking and eStatement delivery today. Tax time is also a great time of year to perform an annual checkup on your finances!