Tools That Can Save Time and Money for Tax Filing
Recent research has found that roughly 81% of the American population owns a smartphone. These devices have countless practical uses; however, not many individuals realize that their smartphones can also save them significant time and money on their taxes. Here are three ways you can utilize your smartphone to your advantage this tax season.
1. Use the Tools You Have
In addition to the thousands of apps that can be downloaded from the app store, a smartphone comes with several very useful apps. One of these apps is the camera. While many of us picture the camera app as a tool for our own enjoyment, it can actually be a helpful tool around tax season. To claim any sort of deduction from the IRS, there needs to be a receipt proving you are eligible to take a given deduction. Instead of keeping paper receipts, which are susceptible to loss or damage, try digitizing your receipts using the smartphone’s camera. Create a designated folder within the camera app for these documents.
Similarly, folders can also be created in your email account to collect any tax-related information. For example, if you are an active trader trade confirmations can be placed in your tax folder for when you compute capital gains amounts. These folders can save a lot of time around tax season instead of scrambling around to find your receipts. The calendar app can also be particularly helpful for individuals claiming business expenses or milage. Use the calendar app to document client meetings, business travel, and other deductible events. The calendar app also lets you go back and look at past events from prior years. If the IRS wants to audit you, they have the right to look at the past seven years of tax information, so utilizing the calendar app will ensure you have the records you need.
2. Back Your Data Up
It is important to frequently back up your data to a cloud software, especially tax-related data, in the event that your device is lost or stolen. The key is to keep your information safe and accessible. If you have an iPhone and use iCloud, you automatically get 5GB of free storage. While you may have to pay for storage updates if you exceed the 5GB, the hassle of losing documents far outweighs the cost of extra storage.
3. Consider Specialized Apps
There are several free apps that can be downloaded from the app store to make your tax-season less stressful. Scanner apps can help you capture and store relevant tax paperwork. If you have an iPhone or iPad and itemize your expenses, ItsDeductible and iDonatedIt can help you track charitable contributions throughout the year. Expensify and Everlance can help self-employed individuals track their business expenses. There are also several apps that track mileage, including MileIq, TripLog, or Everlance.