Create a Detailed Record as You Work on Your Taxes (and Before)
No one is perfect: even the most careful tax filer makes an occasional mistake. In addition, tax rules change, and sometimes we don’t notice all of those changes. Either way, if you keep detailed records of all of your expenses and income, and create a detailed record as you work on your taxes, you’ll be protecting your ability to back-file in the future.
Get Organized
Don’t wait until weeks before the deadline to gather all of your documents; start this right now if you haven’t already. As you collect the receipts, forms, and documents that you’ll need, get rid of everything that you don’t need—securely, by shredding it or sending it to a disposal service.
Tax-free Work Perks: Do You Know What You’re Missing?
Check into all of the ways you can lower your taxes at work. If your employer covers your moving, counselling or educational costs, you may be surprised about how many things you can claim as deductions. A little homework up front may result in some pleasant news for a change at tax time.
Claim All Medical Expenses That You Can
Experts agree that medical expenses are frequently overlooked at tax time. It’s true that when it comes to medical expenses you can only claim expenses that amount to more than three percent of your net income or $2,208 whichever is less. However, there are so many expenses that qualify (for you and your spouse) that you owe it to yourself to see how many you have before you assume you won’t have enough.
Charitable Contributions
If you have a little extra cash this year, consider making the most of the temporary first-time donor super credit (FDSC) which is only available until 2017. This credit allows people donating for the first time to get an additional 25 percent rate on any cash donation of $1,000 or less. For the purposes of this credit you are considered to be a first-time donor if neither you nor your spouse or partner has claimed a charitable donation credit after 2007.*
The Bottom Line
Tax time doesn’t have to mean stress for you. Good planning, research, and careful record keeping are among the simple tools you have at your disposal to ensure your tax season runs smoothly.
And remember that life insurance is a great way to invest in the future for your family—and its benefits are tax-free. Taking care of the points listed above may not be as “taxing” as you think! For answers to your questions on life insurance needs please contact your life insurance advisor or Canada Protection Plan 1-877-851-9090.
