Leigh Edwards, a popular upscale barber at Hair Deux in San Francisco, always takes her annual vacation during tax season. Of her clientele she says, "They all procrastinate then go crazy and end up skipping their appointments. It's by far the slowest time of the year."
Don and Barbara love to entertain, but starting March 1 they go into lockdown. "We don't do anything," says Barbara. "Our entire dining room table is covered with papers anyway."
Rick says that tax time is "agony" because he resents how much he pays in taxes. "I try not to think of it most of the year, but you can't miss it when you see that big final number. All that money that I've made paid to taxes - and then spent so frivolously by the government."
Tax preparation is like a root canal - something you hate doing until you consider the consequences. As such, it stirs up a lot of emotions that can get in the way of rational thinking. No matter what, tax preparation isn't likely to be on anybody's list of favorite ways to spend their spare time. Here are six tips to lessen the psychological strain and get the job done more efficiently.
1. Start Early
Waiting until the last minute is guaranteed to elevate stress and minimize your options. Should you need additional forms, computer advice or decide at the last minute to hire a preparer you'll be fighting the clock and the crowds - making the job even harder.
2. Skip the Emotion
Still not convinced you should start early? Procrastination is related to emotion - as in avoiding negative ones. Besides the cumbersome nature of the task, many procrastinators have anxiety about the complexity of the process, are full of resentment about paying taxes, or fear facing that final number. The problem is by it putting off, you're living with those emotions longer than you need to. Even if they're not overt - they're lingering inside you. You'll have a better chance of getting started and move more efficiently once you do if you own up to those emotions and make a decision to move past them.
3. Chunk It
Break down the process of completing your taxes into pieces and commit to tackling only one task at a time. Gather paperwork in one session and log charitable contributions in another for example. If you end up feeling like doing two tasks in a row go for it. Ornery jobs are always psychologically easier when you break them up into segments and make shorter commitments of your time.
4. Keep Moving
Don't stall out on sections or portions of your preparation that you don't understand. Make a list of problem areas to attend to and plan how to get help. Then keep moving and make progress.
5. Limit Distractions
This isn't the time to multi-task. If you plan to watch television or interact with the family and work on your taxes at the same time the entire job will take longer and seem much bigger and harder. Commit to focusing in small time segments and then reward yourself with television, family or dinner out after you've finished.
6. Work Dispassionately
Pretend you're doing someone else's taxes and try to focus on the project not on things like how much money you spent, lost, saved or have to pay. It's not that an annual review isn't a good idea it's just that now's not the time. Do a post-mortem and plan for the next year after you've finished your taxes.
So what does this have to do with saving money you ask?
Stress sabotages accuracy and depletes energy. You'll make fewer mistakes and have the time and energy to remember every deduction. If you're working with a tax professional the more organized you are the less you'll pay for their services. Either way you'll save money.
For more tax preparation savings tips check out this Kelli B. Grant SmartMoney article.
Ready for a fun quiz? Which cities had the most tax filing procrastinators last year? According to Turbo Tax these are the cities with the highest percentage of last minute (April 14 - 17) online filers:
1. San Francisco
2. Houston
3. New York
4. Chicago
5. San Diego