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Prepare for Tax Filing Season!

Prepare for Tax Filing Season! Fitzwilliams Financial

As tax time draws near, you may have some important tax questions. This article aims to warn of the potential hazards associated with taxes to help you make the most of your return this year.

1. While it may be tempting to submit your taxes without delay, filing before you have all the necessary documents may result in a delay in receiving your return. Therefore, it is best to take the time to verify that you have all the paperwork you need before submitting your taxes.[1]

2. Prior to filing your taxes, it is essential to collect all the necessary documents. This includes knowing your own social security number, the social security numbers of anyone you are claiming as a dependent, and any receipts you plan on using to itemize your deductions. Additionally, you may need to have some of the following documents on hand[2]:

  • A W-2 if you are still working.
  • A 1099 for other income (such as dividends or interest).
  • A 1098 to report mortgage interest you paid.
  • A W-2G if you have any gambling winnings to report.

3. It is essential to ensure that your Social Security number is correct on your documents. Your social security number is very critical when the IRS is looking to recognize you and your records; therefore, you should make sure to go over the information multiple times to ensure its accuracy on the forms.[3]

4. It is important to ensure that the spelling of your name is accurate and coincides with the social security number you submitted. The name on the social security card should be the same one you use when filing taxes, as the Internal Revenue Service uses the name and social security number to locate your information.[4]

5. Ensure that the digits you are entering are precise. It can be effortless to input the wrong numbers or write them incorrectly when handling a great deal of information. And tax software can give an effect of simplicity and continuousness when entering all the details. However, make certain that you don’t insert the incorrect numbers.[5]

6. Take a break! It can be important to step away from your tax documents every now and then so that you don’t burn yourself out. It can be much harder to see errors if you’ve been staring at something for a while. So… step away, take a break, do something you like, and then take another look and ensure that your info is accurate.

7. Make sure you sign your documents. This may seem obvious, but a tax form is not valid without a signature, and it can be easy to forget.[6]

As you can see, accuracy is the most important thing when it comes to tax documents. If you are serious about improving not only how you handle your taxes but also how you handle your finances in general, reach out to us for a complimentary review of your finances.

When consumer confidence hits a multi-decade low, it is completely natural for you to feel a sense of hesitation about your hard-earned savings. If you are approaching retirement, seeing prices rise while trying to figure out the right time to adjust your portfolio can feel incredibly stressful. However, this low confidence might actually be introducing a healthy dose of critical thinking into the market right now. Instead of rushing into investments out of a fear of missing out, I am seeing people take their time to analyze their moves before they act.

This deliberate pace could be a vital asset as we prepare for what might be a historic three trillion dollar wave of tech IPOs. The names hitting the market are incredibly popular, and the media hype may make you feel like you need to change your entire strategy to get a piece of the action. But we must look closely at the underlying reality: many of these massive firms are not yet profitable. The typical corporate fundamentals simply are not there yet.

Because of this, I believe you should treat these speculative assets with extreme caution, much like money you would take to Vegas. If you want to participate, you might consider limiting that exposure to no more than five percent of a well-diversified portfolio. You should never dismantle a carefully crafted, long-term retirement plan just to follow a market trend. Furthermore, you must realize that extreme trading volumes during these public launches could cause your orders to execute at vastly different prices than you originally intended. It pays to be patient and let the dust settle.

If you have questions about how these shifting market dynamics might apply to your personal retirement plan, our team is always here to help.

Key Takeaways

  • A drop in consumer confidence may encourage a healthier investment environment by forcing individuals to rely on critical thinking instead of emotion.
  • An upcoming wave of massive technology IPOs might generate significant media hype, but these companies may lack current profitability and traditional business fundamentals.
  • Investors should avoid allocating more than five percent of a diversified portfolio to highly speculative, unproven market assets.
  • Heavy trading volume during a major public offering could cause investment orders to execute differently than an investor expects.

Fitzwilliams Wealth Management, Inc. is an SEC registered investment adviser. FWM and Fitzwilliams Financial are affiliated companies. This content is for informational purposes only and should not be construed as personalized investment advice. We do not provide tax or legal advice. Investing involves risk. Media appearances are for informational purposes only and do not constitute an endorsement.
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