Avoiding IRS Anxiety
You’ve felt it at one time or another; that sinking feeling that something just isn’t right with your taxes and you’re going to hear from the IRS any day. The motivation for this nagging anxiety may be real or merely the imagined byproduct of a collective, subconscious fear of facing the country’s most powerful collection agency. Regardless of whether your paranoia over an IRS issue is justified, though, there are some basic steps you can take in reducing your reason to worry –and your blood pressure.
Although any legitimate, tangible IRS problem should be addressed expeditiously, you can eliminate any fear over undiscovered issues ultimately becoming, well, discovered. Best practices in this endeavor include taking caution in your tax habits, as well as a simple review of what you’ve already reported. Your goal at the end of your checklist should be to confirm that no outstanding tax concern should be expected on the horizon, and to, in turn, negate that awful feeling that you’ve made a catastrophic tax error.
There are a handful of to-do’s you should always bear in mind when maintaining a clean bill of tax health. These include filing and preparing your taxes in a timely fashion, which is to say by the deadline, and making sure that everything on your return is accurate and triple-checked. It also means considering how your unique circumstances might constitute an exception when it comes to your tax tasks.
For instance, if you’re earning your income as a contractor and aren’t having taxes withheld from your wages, you’ll have a different set of responsibilities from your employed counterparts. You’ll need to estimate and pay your taxes on a quarterly basis throughout the year, taking caution to ensure the accuracy of all of your income reporting. If you’re careful and timely, though, you should give the IRS no reason to interrupt your day with a notice.
Items for Review
If you’ve ever taken a test, you no doubt understand the importance of double-checking your work. This principle also applies to your taxes, as you should be scrutinizing the accuracy of everything you’ve reported before you file. However, if you’re only attempting to mitigate disquieting suspicions, you may take an afternoon and look over returns for the last three years. Compare the information you’ve reported with that found on the respective year’s wage statements – and plan on being thorough on your next return to avoid the need to review it later.
When it comes to taxes, no matter how thorough you are, the reality is that you never know what to expect. Even an apparently flawless return may be randomly selected for an audit, so harboring anxiety over a tax problem is typically unproductive. The best you can do is to keep up with your tax responsibilities and keep all of your relevant tax documents in a secure space. So long as your paperwork is organized and complete, you should be able to consider any tension over a tax problem as illusory dread.
No matter what, there is a solution to every problem; even those with the IRS. Should you receive a notice of a tax debt that you don’t understand, don’t agree with or can’t pay, you may enlist a licensed tax professional to take a look. The initial consultation comes at no cost and if a resolution is necessary, this should be affordable. Even if you are confronted with an IRS issue, though, you can avoid paralyzing fear by attacking it directly and conclusively.