New Year’s Tax Planning Tips

The end of the year typically involves a flurry of activities, most of which center around preparing for the holiday season. For many people, while attending to end-of-year tax planning is important, it is also easily forgotten or at the bottom of to-do lists.

Now that a new year has begun and your mailbox is filling up with W-2s and other tax statements, it is common to feel a certain sense of dread. If this describes your current situation, take heart. Our Tampa asset protection attorney has some simple tips to help you prepare.

 Preparing For Tax Season 

Time seems to go by quickly, particularly during the transition from one year to the next. While the prior months may have been focused on holiday gatherings and gift-giving, the new year typically centers around paying bills and preparing for tax season.

The April 18 deadline for filing your 2022 tax returns with the Internal Revenue Service is still a good way off, but there are some steps you should be taking now to ensure you are ready. These include:

• Create a file folder to keep all of your W-2s and other tax documents organized and in one place;
• Watch for end-of-year statements from credit cards, banks, or other financial institutions, and keep these organized in a file folder as well;
• Make a list of all major purchases and expenditures made during 2022, including homes, cars, appliances, stocks, investments, and loans or gifts to family and friends;
• Make a list of all repairs or any remodeling you may do, which may entitle you to tax credits;
• Consider your prior year’s medical expenses and any unexpected situations that may have happened that jeopardized your health or financial situation.

Practical Steps To Take Now To Protect Yourself During Tax Season

While the official cutoff for income and expenses for the current year’s tax return was December 31, 2022, there are still some actions you can take throughout the early part of 2023 that can benefit you once you file. Turbo Tax recommends a few practical steps that can help reduce your tax debt:

• Make contributions to retirement accounts: You have up until April 18th to make these payments, which can provide major tax credits.
• Pay estimated taxes: If you are self-employed and missed quarterly payments, you can still pay up to the tax filing deadline to avoid penalties.
• Calculate business deductions: if you own any type of business, carefully consider all deductible expenses, including home office and travel costs, advertising, business license fees, contractor payments, and depreciation on equipment.
• Review spending statements: While most people take the standard deduction, review year-end spending statements to see if itemized deductions could further reduce tax debts.

Reach Out To Our Tampa Asset Protection Attorney To Request A Consultation

Tax planning plays an important role in protecting and preserving your assets. To discuss additional strategies that can help you and your loved ones, reach out to Strategic Counsel Law Group, L.C. Call or contact our office online and request a consultation with our Tampa asset protection attorney.

Sources:

irs.gov/pub/irs-dft/p509–dft.pdf

turbotax.intuit.com/tax-tips/tax-planning-and-checklists/tax-tips-after-january-1st/L8fY6OyFl