FinanceTax

Taxes Don’t Have to Be Scary

2 Mins read

tax- taxesLeave it to taxes to ruin a perfectly nice time like spring. After slugging through snow and ice for a couple of months, we get to celebrate our meteorological freedom by slugging through receipts and papers for a week, then sweating as our tax professional finds out how much more Uncle Sam gets to take from us. And considering that it was tax evasion that took down notorious mobsters like Al Capone, we think of the IRS as the ultimate enforcer.

No wonder we get scared. We should be–but not of the government. The biggest threats to us at tax time are thieves and our own recklessness.

Hackers, Scammers, And Other Criminals

What should make you sit up and worry is the chance of getting scammed. With the highly computerized tax system, there are plenty of openings for thieves that didn’t exist several years ago. It’s the price we pay for fewer errors and faster processing.

Be vigilant for attempted hacks. The IRS will not email you, and they will not call you. If you ever have any concerns about any communication that purports to be from the IRS, get a legitimate phone number and make the call yourself.

Keep an eye on sources, which monitors for new fraud tactics and helps you learn how to avoid them.

Bad Strategies

As complex as our tax code is, we can still work within it and not have difficulty with filing. The fact is, if you’ve had a good tax strategy in place at the beginning of the year and have done things correctly and consistently along the way, filing time won’t be quite as surprising. You shouldn’t be losing sleep over it.

What makes trouble for individuals and businesses alike is the failure to keep things current along the way. Make sure your withholding for employees is being calculated correctly and make sure that it’s properly documented AND sent in. Thousands of businesses run afoul of the IRS because of withholding. Don’t become one of them.

Track your expenses, and as soon as you can, classify those that are deductible. Then have a system in place to keep them totaled and filed so that return time is simpler.

Plain Old Fraud

Temptation is an ugly thing. A few dollars here or there can seem like they won’t matter to Uncle Sam nearly as much as they will to you. Do they really need another $1,000 from me to help fuel up an army tank?

Of course, this thinking never pays. Instead, it’s a mighty fine way to lose money and freedom. There will come a point when you will wish you could buy your way out of your problems with $1,000. Far better to pay what you owe and not risk it!

Of course, it’s not always that overt. There is gray area in our massive tax code, and we can wander into the darker shades if we aren’t careful. When in doubt, pay more. If an audit is done later on, you’ll prefer that the IRS finds out it owes you money than the other way around. Err on the side of the law!

Taxes are an arduous and complicated burden on everyone. But they don’t have to be scary for anybody. Use good sense, plan ahead, and follow the law. You’ll find there’s no monster under the bed.

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Ryan Kh is a big data and analytic expert, marketing digital products on Amazon's Envato. He is not just passionate about latest buzz and tech stuff but in fact he's totally into it. Follow Ryan’s daily posts on Catalyst For Business.
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