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- Income Tax
The Simplest Forms can be Complex
I always do my tax return by paper and electronically. I believe overall the entire process of 'tax season' is overwhelming whereas the simplest forms seem complex. This is also true for mortgage documents. It is better to become more familiar with the forms and the process so that you're not ignorant to the fact that the mortgage broker/efile provider you are utilizing is actually working in your favor and not against you.
It is essential for you as an individual, sole proprietor, business owner to become knowledgeable on the tax topics when filing your return. www.irs.gov features a section under "HELP AND RESOURCES" that will help guide you on tax topics that gives you specific tax forms and publications to fill out for claiming deductions and credits as well as determining what income is taxable to you to report and on what forms. The interactive tax law assistant is a great tool to assist with those questions that you have during tax season. This tool is also found on www.irs.gov. Don't be surprised if your tax preparer calls the IRS to get the same questions answered and when that happens wouldn't you want to know if they are trained properly to assist you in preparing your return? Get the information before going into that preparers office. This will keep you on top of your tax preparer-making sure he/she is taking advantage of the right deductions and credits available to you.
If you're looking to purchase a home, the homebuyer education classes are needed. Last year I purchased my first home. It was an overwhelming process to say the least. After being told I would have to take a class before getting approved for my loan, I was more than willing to take a Saturday off and learn more about purchasing a home. Was I ready to make this decision? The terminology that was thrown at me from my real estate broker, the mortgage loan officer was greek to me. I felt out of place and stressed through the entire process. What got me through was the fact that I learned the terminology. Yes I was paying someone to assist me but what difference did that make if I didn't know if I was getting a great deal or not? In the end I would be the only party responsible.
The bottom line "ignorance is not an excuse". For some of us we feel a sense of entitlement when we are spending money and paying people to 'know' what is good for us. It wouldn't hurt if we became conscious of what we were getting ourselves into. Trying to avoid having the IRS audit our returns and or making a bad decision in what is one of the most important ventures in our life such as owning a home is imperative.