The 2022 tax season is quickly approaching: This year, you have until April 18, 2023 to file your taxes.
As you prepare for the big day, we’ve created a guide to help you prepare for tax season, even if you have debt.
#1 Gather Your Annual Tax Documents
First, you need to collect your tax documents. You’ll likely receive these documents in the mail in January or early February. You may also be able to download them online once they’re available.
The most common tax documents include:
- Form W-2 – If you work as an employee, your employer will send you Form W-2.
- Form 1099 – If you earn income from dividends, interest, or independent contract work, you’ll receive the associated version of Form 1099.
- From 1099-B – If you earned or lost money on the stock market this year, your brokerage will send you Form 1099-B.
- Form 1098 – If you have a mortgage, you’ll receive Form 1098 from your lender so you can deduct your interest payments.
#2 Itemize Your Deductions
Next, it’s important to review your receipts to itemize your deductions.
The most common tax deductions for individuals include:
- Medical and dental costs that aren’t covered by your health plan
- Property taxes
- Investment expenses
- Retirement account contributions
- Charitable contributions
- Work-related educational expenses
- Qualifying business expenses
If you use the standard tax deduction, you can skip this step.
#3 Select a Tax Preparer
You can fill out your tax return yourself or enlist the help of a tax professional. If your taxes are relatively straightforward, it may be cheaper to file your taxes on your own using tax preparation software like TurboTax or H&R Block.
These user-friendly tools can guide you through the tax preparation process step-by-step. They also ensure that you won’t make any mathematical mistakes.
Here at North Jersey Federal Credit Union (NJFCU), we offer special discounts on tax preparation software to our members. Old and new members can get $15 off TurboTax, while new members can get $15 off H&R Block.
#4 Consider the Impact of Your Debts
If you have debt or had debt in the past year, it may affect your taxes in the following ways:
- If any of your debt has been forgiven, you may need to add it to your taxable income.
- If you have any loans in forbearance, your deductions may be reduced.
- If you owe money to debt collectors, they may garnish your tax refund once it reaches your account.
Best Credit Union New Jersey: Streamline Your Debt Today
Timely preparation can make this tax season a breeze, and the sooner you start preparing for tax season, the better equipped you’ll be.
That said, if you currently have multiple debt payments to juggle each month, also consider New Jersey Credit Union’s debt consolidation services. Our personal loans NJ provide quick access to funds and streamline your future tax reports.
If you’re ready to take advantage of our tax preparation software discounts and consolidate your debt, become an NJFCU member today.
