Year-end Planning Tips - 9/10 - Review prior year tax returns

They say hindsight is always 20/20 vision.   Sometimes we use it to beat ourselves up on how wrong we read a situation and other times it is to pat ourselves on the back.  With your taxes, however, a timely review of prior years can prove beneficial, for both past, current and future years.  With a through review of our prior year tax returns overlooked tax credits, deductions or tax treatment of income can be highlighted. Amending your tax return may bring about a refund if you had made errors such as not reporting income, dependents, filing status or tax credits.  While you cannot amend a return for maths errors always keep in mind when you can there is a three year statute limitation from the original due date of the return,

Any omissions found in a prior tax return must be noted to see applicability for current and future years.   Depending on the complexity of your tax return it would be advisable to employ the services of an accountant specializing in individual income taxes for qualified competent assistance as this almost always serves you well.

Most of us procrastinate with the preparation and filing of our personal income tax returns.  We go through the year making mental notes as we come across things that can affect our taxable income and yet we seldom take the necessary action that will make these advantageous.  Precious few do any  do any tax planning before year-end.  The new year rolls in, we received our Form W2; 1099 or K1s and we stash them away as April 15th seems so far away.....

Not until we start hearing the final count down on the news channels and commercials for tax preparation software blaring through the airwaves a  few days prior to "Tax Day" do we pay attention and start hastily putting our records together.  This is no way to ensure that the tax return we file in any given year aids us in having tax-efficiency.  Any tax efficiency achieved translates into savings and in turn increases your accumulated wealth.