10 Tax Tips

By Selena Maranjian

It's finally here -- that most exciting time of the year! We giggle like schoolgirls watching the letter carrier approach our home, hoping to find 1099 and W-2 forms nestled in our mail. We find it hard to concentrate on our jobs as we daydream about deductions and credits. We miss our stop on the train ride home from work because we're so engrossed by IRS Publication 514, "Foreign Tax Credit for Individuals." That's right -- it's tax season!

OK, you're probably not that excited about tax season. Still, it's not something we can ignore. Like it or not, most of us are stuck dealing with taxes once a year. In the hope of making your tax season and the coming tax year a little less painful, I hereby offer a few tips.

1. Be neat! It might be hard to write legibly after hours and hours of staring at barely comprehensible forms and filling in boxes, but don't succumb to sloppiness. The authors of What the IRS Doesn't Want You to Know state that "neat returns, especially computerized ones, are less likely to be audited than handwritten or sloppy ones. Even the IRS has gone on record stating that computerized returns are preferable...."

2. Avoid getting a large tax refund. It means you're lending money, interest-free, to Uncle Sam. Plus, you're missing out on the opportunity to invest that money earlier in the year, thereby having more time to grow. There's also a chance that unusually large refunds could draw the attention of some IRS auditors. So consider revisiting a W-4 form and revising your withholding so that it more accurately reflects your expected taxes...

Read the rest here: