When it comes to tax time, for many people it’s a scramble to prepare the necessary information, itemize the deductions, complete the forms, and so forth. Having a tax accountant prepare your taxes can be much easier, but there are still a number of steps for the average person to handle. If you are able to claim deductions on your taxes, for example as a small business or in terms of medical expenses, it is important to keep records of your spending and retain your receipts and billing statements so you have them when you file your taxes.
Even if you keep all of your receipts after every purchase, reviewing your credit card statements as you prepare your list of expenses or your Schedule C can be very useful. Credit card statements capture every purchase made with that card, including online purchases that may not issue a receipt as well as charitable donations made by credit card and those items and purchases where the receipt may have gotten misplaced or damaged. You can also keep better tabs on doctor bills and other medical expenses that may be valid deductions.
TurboTax and other tax preparation programs are capable of downloading your credit card statements to help you file your taxes and record expenses. To make tax filing even easier, throughout the year you can use one credit card for personal expenses and another card for expenses that would be deductible on your taxes.
In order to save the most money on your taxes possible, be sure to review your credit card statements in detail. You may even be able to write off some of the interest if you carry a balance on your card. If you find any questionable expenses, simply ask your tax accountant for advice on the particular purchase and its validity as a deduction.