Tax Season is Here: What You Need to Know to Stay Prepared
Ready or not, tax season is upon us. It’s a reality for just about everyone – you have to file, pay, or maybe you’re expecting a refund. With the tax filing deadline set for April 15th, there are key considerations to keep in mind to ensure a smooth process and avoid unnecessary penalties.
File On Time – Even If You Can’t Pay
One of the most important things to remember is to file your taxes on time, even if you’re unable to pay the full amount you owe. Filing on time prevents additional failure-to-file penalties, which can be more severe than failure-to-pay penalties. If you owe taxes but can’t pay in full, it’s better to file and communicate with the Internal Revenue Service (IRS). You can work with them on a payment plan to settle your tax liability over time.
If you need more time to gather your documents or finalize your return, you can file for an extension, which moves your filing deadline to October 15th. However, keep in mind that an extension to file is not an extension to pay – interest and penalties may still accrue on any unpaid balance.
Gather Your Tax Documents Early
To streamline your tax filing, start accumulating all necessary documents as soon as possible. Common forms include:
W-2s from employers
1099s for contract work, dividends, or other sources of income
Mortgage interest statements
Student loan interest forms
Charitable donation receipts
Business expense records (if applicable)
Having these documents organized in advance can prevent last-minute stress and ensure you claim all eligible deductions and credits.
Adjust for Next Year’s Taxes
If you weren’t satisfied with your tax outcome this year, now is the time to make adjustments for the next tax season. If you consistently owe taxes, consider increasing your withholdings on your W-4 form to reduce your tax burden throughout the year. If you’re self-employed or receive 1099 income, you might want to increase your estimated quarterly tax payments to avoid a large bill at tax time.
Everyone’s situation is different, so it’s essential to tailor your tax strategy to your unique financial circumstances. Consulting with a CPA or tax professional can help you make informed decisions and avoid surprises.
Tax Planning: A Year-Round Strategy
At North Main Financial Group, we understand that tax planning isn’t just about filing your return – it’s about taking a proactive approach throughout the year. While we don’t prepare tax returns, we specialize in tax planning strategies to help you optimize your finances and minimize liabilities. Whether it’s adjusting withholdings, managing investments for tax efficiency, or planning for future deductions, we’re here to help.
If you have questions about tax planning or would like to review your financial space, call us at (704) 987-1425 or visit us virtually at www.northmainfinancial.com. If you wish to schedule an introductory meeting, we would be happy to meet with you at no cost or obligation to you.
These Blogs are provided for informational purposes only and should not be construed as investment advice. Any opinions or forecasts contained herein reflect the subjective judgments and assumptions of the authors only and do not necessarily reflect the views of Osaic Wealth.
