NEW YORK (MainStreet) — I hope that high on your list of 2013 New Year’s Resolutions is “Become more informed about taxes.”
It is impossible to know the right moves to make in your daily financial life without a basic knowledge of the tax implications of your actions.
Learn what items you can, and cannot, deduct on your tax return, including the special items unique to your trade or profession and the rules governing any special situations that apply to you. And keep up-to-date on federal and state tax law changes.
Even if you use a tax professional to prepare your return, the more informed you are on taxes the more prepared you will be when you go to your annual appointment.
Also on your list of resolutions should be “Keep good tax records.”
You must keep detailed, contemporaneous records of all your income and deductions in the manner prescribed by the IRS and tax code.