2022 is coming to an end and while it may seem a little early to start thinking about the 2023 tax season, it is actually the perfect time to begin taking inventory and preparing. Read on for helpful tips for this upcoming tax season.
Home edit: organization is key
It is time to get organized. Taxes can be tricky, but tracking and documenting things like mileage, donations and business expenses are critical when it comes time to consider deductions. Not to worry, there are many different ways to keep track of these expenses, from traditional paper receipts to more technical options like mileage tracking apps or digital document storage. Whatever method is used, the goal is to have access to all the necessary information when it comes time to hand it over to a CPA.
Trade and track
With increased focus on and investment in digital currency, it is crucial to correctly track trades when investing in cryptocurrency. The tax implications of cryptocurrency can sometimes be confusing, so consult a CPA.
One must adjust
Changes like a new baby, or a decrease in the number of dependents, can affect tax liability, so adjustments on the W-4 need to reflect that. Planning ahead and periodic check-ups on finances can help to spot needed adjustments before there are impacts. Working with a CPA and a financial advisor can help so proper steps are taken to stay on track throughout the year.
Noted
Take notes on how to better organize tax documents for future tax seasons and be sure to implement those changes. Tax season comes every year and there is no time to prepare for it like the present.
Important dates to remember
January 2023 – 2022 Tax season begins. This marks the first day the IRS will start accepting and processing 2022 federal tax returns.
January 31, 2023 – Due date for employers to send W-2 forms.
January 31, 2023 – Certain 1099 forms are sent. Various 1099 forms and forms 1099-NEC,1099-MISC and 1099-K are used to report payments that typically do not come from an employer, such as work as an independent contractor.
February 15, 2023 – Reclaim exemptions from withholding.
April 3, 2023 – Required minimum distribution due for those who turned 72 in 2022.
April 18, 2023 – Tax Day (unless extended due to local state holiday). The tax deadline typically falls on April 15 yearly but can be delayed if it falls on a weekend or holiday.
April 18, 2023 – The Tax Day deadline is also the last day to file Form 4868, requesting an extension to file individual income tax returns.
By Meredith Biesinger.