When those W-2s and/or 1099s started to arrive in January, you filed them right away—not into a neat, labeled folder but a kitchen drawer full of expired Bed Bath & Beyond coupons and soy sauce packets. You had plenty of time. In fact, you were totally going to figure out how to do your taxes early this year. First, you just had to complete a couple of work projects, book some Airbnbs for next summer, binge-watch Ozark from the beginning, spend a couple of weeks puppy-stalking on Petfinder, and attempt a DIY backsplash makeover—among other urgent matters.
Which brings you to now: oh-crap-I-really-need-to-file-my-taxes season. If just about everything on your to-do list and Netflix queue got bumped ahead of “organize 2021 tax documents,” you’re far from alone. In the hierarchy of most-loathed adult responsibilities, doing taxes ranks somewhere between visiting the DMV and getting a mammogram. It doesn’t help that these days, many of us are finding it harder than ever to motivate and focus on tedious tasks thanks to two-plus years of wacky work/life schedules, spotty self-care, and nonstop anxiety-inducing news.
“No one jumps out of bed in the morning and says, ‘I can’t wait to get started on my tax return!’” says Judith Lu, CEO and founder of Blue Zone Wealth Advisors in Los Angeles. “It’s a cumbersome process that most of us dread.” Plus, your taxes might look a bit different this year if you got laid off or changed jobs or went freelance earlier in the pandemic—all the more reason for anxiety. The good news: As with many things, getting past that dread is often the hardest part. Once you get going, preparing your tax return can be weirdly satisfying. As a jump start, tackle the following five tasks. If you focus, you can knock them off in one night, and you’ll be well on your way to putting tax season in your rearview mirror—and maybe even getting a nice refund to put toward one of those vacation rentals or rescue puppies. Just don’t hold your breath waiting for that—the IRS isn’t running on time either.
Locate last year’s tax return.
You (hopefully) have a copy of last year’s tax return saved or stashed somewhere. Go find it. It’s the best blueprint to guide you through what information you’ll need to gather this year, even if some (or many) details have changed. For instance, last year’s return will remind you about specific deductions you took and income sources you have—like interest from that investment account your mom set up for you that you only think about at tax time—so you won’t forget anything. If you can’t find your return, you can visit IRS.gov to download a tax transcript (a summarized version of your return) instantly or request a hard copy via mail, which should arrive in five to 10 business days.
Make a mental list of major stuff that happened in 2021.
Think back to any significant life events that have gone down since the last time you sat down to think about taxes, e.g., you had a hospital visit where you racked up tons of bills, went on unemployment for a while, got married, had a baby, adopted a child, bought (or sold) an apartment or house, or sold off your stock options from your last job to fund starting your own business. These sorts of things can change how much you owe as compared to last year, so you’ll want to be sure to account for each of them on your return—don’t just crib everything off of last year’s forms to get your filing done quickly.
Go on a form-finding mission.
Time to track down those tax forms. Relocate those that arrived via snail mail, then check your email and junk mail—many companies send paperless tax forms these days. You need to gather all forms showing income you had during the year: a W-2 if you’re a full-time salaried employee, 1099 forms if you earned freelance, unemployment, or investment income, plus forms for any government stimulus checks you received in 2021. You can use last year’s tax return to help remind you which forms you need this time, for example, 1099s from all of your bank accounts. “If you don’t know what documents you need based on last year’s tax return, here’s a list to get you started,” says financial expert Ashley Feinstein Gerstley, founder of the Fiscal Femme and a partner with pay-over-time solution Affirm. “It’s also helpful to make a list of your accounts—everything from savings to investment accounts. You can log in to each and go to the tax forms section of their websites—most will have some variation—to pull any tax documents.”
Compile your deduction documentation.
Over on the deduction side—the side that saves you money!—you’ll need to pull together items that document expenses you can write off, including receipts for small-business expenses, statements from your childcare provider, property tax statements, receipts for donations and charitable contributions, and statements showing medical expenses, or that you’ve paid for your own healthcare premiums (versus an employer doing so). Quickly glancing through your bank and credit card statements for the past 12 months will help ensure you don’t miss anything. Other forms you might need: a 1098 for mortgage interest, and if you buy your own health insurance through HealthCare.gov, a 1095-A form.
Line up some help if you’re in over your head.
It may not be too late—some accountants take on new clients right up until tax day. But you should definitely reach out to someone now if you’re pretty sure you need tax help this time around. “Taxes are especially complicated in 2021,” admits Gail Rosen, a CPA in Martinsville, NJ. And hiring a local pro isn’t the only way to get assistance if you feel like you’re fumbling through your returns in the dark but can’t find anyone local to help you out. “It’s worth looking online for help—there’s more variety than ever,” says Lindsey Swanson, a CFP in Whitethorn, CA. “People have historically hired tax professionals that are local, but you can absolutely work virtually with someone in a different area. This can be especially helpful if you live in a city that has a high cost of living. You’ll just want to make sure that person is licensed and aware of your local laws.” You might even be able to get help as your sort out how to do your taxes—without shelling out any extra cash. “For a federal tax return with an adjusted gross income of up to $73,000, guided tax preparation is available for free via an IRS partner site,” says Dr. Lei Han, PhD, a CPA and associate professor of accounting at Niagara University in Lewiston, NY.
