New Year’s Resolutions: Avoid IRS Problems and Save on Taxes

The best New Year’s resolutions are achievable and specific. Instead of getting stressed out by tax season, commit yourself to these six simple New Year’s resolutions. For in depth tax guidance, contact the tax planners at Cohen & Burnett.

1. I Will Pay Attention to Each 1099 Form

These little tax reports will start showing up in your mailbox soon, so be on the lookout. Each of them contains your Social Security Number and matches up with your tax return. Make sure to pay attention to them, because the IRS will.

2. I Will Consider Taxes Before Signing Agreements

This includes employment agreements, leases, settlement agreements, purchase agreements, independent contractor agreements, and more. They don’t have to be big-dollar deals to have significant tax consequences. Examine agreements before you sign them so you can make any necessary modifications.

3. I Will Keep Good Records

Most people don’t enjoy keeping tax records, but playing catch up is even worse. Whether they’re for personal records or your business, staying organized is essential. Keep copies of checks, payments, contracts, leases, invoices, and receipts. Staying compliant and answering any IRS inquiries becomes much easier when you know where to look.

4. I Will Deal With Notices Promptly

Handling IRS notices promptly. It is easier for tax professionals to gain a favorable result if notified as early as possible. For example, if you choose not to respond to an IRS 90-day letter, you lose the chance to take it to Tax Court. Instead, you’ll need to file a refund claim and then proceed to District Court or Claims Court. If you receive an IRS notice requesting a response in 30 days, hire a professional as soon as possible.

5. I Will Not Fight Over Pennies

Everyone enjoys being right, but arguing with the IRS over small sums is of dubious value. When it comes down to it, your time is more valuable than a trivial sum. In some situations disputing that small amount can backfire, causing the IRS to search for (and sometimes find) other issues.

6. I Will Run Numbers

Just because you can claim a deduction doesn’t mean you always want to. Double-check your numbers to make sure you are receiving the best tax benefits possible. This resolution will likely involve tax professionals like those at Cohen & Burnett.

Tax Preparation with Cohen & Burnett

The sooner you start preparing for tax season, the easier it’s likely to be. If you want to get ahead of the game, choose the tax law and preparation experts at Cohen & Burnett. We have provided personalized service and consultation to the Washington, D.C. metro area for the last 25 years. For more information, visit our homepage or contact us today.

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