Oliver Wendell Holmes, Jr. said “Taxes are
what we pay for a civilized society.”
Now is the time to start organizing yours. Gather all of your receipts and notes. Look at major differences between your 2010
numbers and those for 2011. You should
have all of your W-2s and 1099s by January 31.
The earlier you file the faster you can
get your return. Estimating your
liability early, even if you don’t file early, will allow you to manage your
budget more accurately. Dragging your feet until the last moment could be
costly.
This is also a good time to adjust your
W-4 deductions. You should only be withholding
enough to cover your taxes; getting a big return means you let the government
use your money, interest free. Wouldn’t
you rather have that money in your pocket?
If your refund totals more than $1000.00, you are having too much withheld. A common strategy is to adjust your
withholding and put the extra money into your emergency fund or
retirement. You won’t miss the money out
of your check, you aren’t seeing it now, but you will be better prepared for
the future
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