Just starting your taxes? Here are 8 last-minute tax tips for insurance agents

If you’re like many Americans (1 in 3, to be exact), you’re likely putting off submitting your taxes until the last two weeks before the April 18 deadline. Some may call it procrastination; others prefer to call it “working under pressure.” 

However you choose to define waiting until the eleventh hour, help ease last minute scrambling with these eight last-minute tax tips for insurance agents: 

1. Locate and compile all required documents. Dig through that pile of mail, file folders, and desk drawers to locate all of the following forms:

  • W-2s—from your employer(s)
  • 1099s—for independent contractors 
  • 1099-INT—for interest earned on things like a savings account
  • 1098—for mortgage interest statement on a home loan
  • Receipts—from any business, healthcare, and education purchases or payments

2. Make a deduction checklist. It’s tempting to try to remember deductions off the top of your head when in a rush to file your return. That’s why we’re adding this as the second of our last-minute tax tips for insurance agents. Writing them down in advance will help you avoid overlooking anything that could result in a write-off.

One commonly overlooked deduction?

“Don’t forget mileage,” advises Irina Kranz, Arrowhead’s director of financial planning and licensed CPA. “Consider the difference between IRS-allowable mileage rate versus actual expenses for vehicle use. If the vehicle is used primarily for business, you may want to deduct actual expenses. Consult your tax professional for advice.”

It’s also important to determine how you’d like to spread out your deductions.

"What's deductible this year alone versus spreading out the deduction among future years as a depreciable expense can greatly impact your decision for software as well as tangible assets purchase decisions,” Kranz added. “There may be bonus depreciation deductions available this year. Consult your tax professional for more information."

3. Turn losses into wins. When itemizing deductions, don’t forget to include realized capital losses, such as stocks sold for less than the price you bought them, mortgage or home equity loan interest, student loan interest, and business loans or lines of credit interest—all of which are deductible to varying degrees.

4. Contribute to an IRA or HSA. Contributions to an IRA or HSA are both tax-deferred and tax deductible, and you have until April 17 to make a contribution that counts towards this year’s taxes.  

5. Avoid last minute mistakes. It’s easy to make rookie mistakes when in a hurry, but even the smallest of errors can result in a filing delay. Be sure to look your return over for simple math errors, incorrectly entered addresses or social security numbers, and to ensure you signed on all the dotted lines. 

6. Watch out for scammers. Tax season brings all kinds of shady characters out of the woodwork who grow increasingly more clever in their schemes. Check out some of the most common tax scams this season below, and make sure you’re protected with a free 24/7 credit monitoring service and making a point of not giving out any personal financial information to just anyone. 

7. File online. Using an online tax service is faster than trying to book a last-minute appointment with your accountant who is likely fielding other last-minute appointments from other people in your same position. Filing online allows you to do so quickly last minute—and could possibly result in a faster refund as well.

8. Request an extension. About eight million Americans file for a tax extension each year. If you happen to fall into that category this season, use Form 4868 available on the IRS website. Extensions are generally granted automatically, and you do not need to explain the reason behind your request. The one requirement is that you request by no later than midnight on April 18.  To be clear, requesting an extension is not requesting an extension of time to pay taxes, so be sure to pay as much as possible of your owed balance. 

No matter your reason for procrastinating—ahem, “working under pressure”—April taxes don’t need to bring May tears. Use these last-minute tax tips for insurance agents to prepare as much as possible within the available timeframe to avoid seasonal panic. Then sit back and welcome spring (and hopefully a nice return as well!)

 

Top 2018 Tax Scams

1. Phone scams: Anyone who calls you claiming to be the IRS is not. The IRS will never call, text, or email you out of the blue nor ask you to wire cash, provide bank information or threaten to arrest or deport you. Feel free to simply hang up if you receive a call like this. 

2. Phishing: The latest twist this season consists of unexpected refunds deposited into your bank account using your stolen information. They will contact you pretending to be the IRS, requesting you return the erroneously deposited refund. Another email scheme is thieves posing as your bank, requesting you provide your account passwords.

3. Shady tax preparers: Most are honest; a few are not. If a tax preparer bases their fee on your refund amount, encourages you to take illegitimate tax breaks, or under-reports your income…take your business elsewhere.

4. Fake charities: Some groups asking for money operate under names that are similar to well-known charities. Ask for the group’s employer ID number and enter it into the IRS Exempt Organizations check to verify qualified charities.

5. Identity theft: The good news is that tax-related identity theft is one the decline. The bad news is it still poses a substantial risk. Thieves will file in your name and claim your refund. Educate yourself on scams and never give personal information to untrustworthy sources.