One Stop Mortgage Corp Blog

Self-Employed? Now’s the Time to Prepare for 2016 Tax Season

November 20th, 2015

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Imagine yourself in a few weeks gathered around the fire, your family and friends relaxing comfortably around you as you reflect on the year that was and the year to come.

Oh yeah, you’re going to have to pay taxes in a couple months. Can’t this just be the end of 2015?

Wouldn’t it be nice if you didn’t have taxes and debt on your mind this holiday season?

We all dread tax season, but it’s even more time-consuming for business owners, sub contractors and the self-employed. Hopefully you’ve been keeping track of your receipts and expenses throughout the year, but if you haven’t, the last couple weeks of November are a great time to get organized.

Why?

 

Do What you Can Now Instead of Putting it Off

Once the holidays come and go you’re going to get busy. Sure, you’re busy now, gearing up for the holidays, but being busy creates momentum. You know how sometimes you start with cleaning the bathroom and before you know it you’ve cleaned the whole house?

Taking care of your expenses follows the same steps. Organize one receipt, then another, and before you know it you’ve got a complete trail of your financial history for the past year. All that’s left is to take it to your accountant at the end of January.

 

Improving Credit

A couple weeks back we wrote about ways to improve your credit rating. Well, paying your taxes early will not only help with your credit report, it will give you a jumpstart on minimizing your debt in 2016. These days there are multiple ways to file your taxes, so the only thing standing in your way is your own schedule.

So make it happen!

If you’re self-employed, here are some of the steps you can take today to get organized for tax season:

  1. organize expense reports
  2. collect and file receipts
  3. account for gas mileage and other work-related expenses

H&R Block has a handy list of other documents, such as your T4’s, you might need.

 

Spending Preparation

The hidden benefit to organizing your taxes now is getting a clearer picture of how much you have to spend on the upcoming holiday season. Gifts, food and travel aren’t cheap, but they’re a priority for people all over the world. Maybe you have a little less to spend than you thought, or maybe you have a little more than you thought - either way, it pays to outline your tax situation before the calendar turns over to 2016.

The last thing you want at the end of April is to discover your holiday spending habits will actually cost more than what the actual price tag indicated in December.

 

Facing Reality

Look, no one likes paying taxes, but it’s the price we pay for living in this country. We have roads, schools, garbage collection and plenty of other services that run on our tax income. We might not always agree with taxes, but there’s only one other certainty in life, and we don’t want to go down that path.

Ignoring your taxes until the last possible second isn’t the answer either. Get ahead of the game now, while you can, and when it comes time to file you’ll be glad you did.

 

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