For most taxpayers, the tax deadline has passed. But planning for next year can start now. The IRS reminds taxpayers that being organized and planning ahead can save time and money in 2020. Here are some things you can do now to make next April 15 easier.
Adjust your withholding. Each year, millions of American workers have far more taxes withheld from their pay than is required. Now is a good time to review your withholding to make the taxes withheld from your pay closer to the taxes you'll owe this year.
This is especially true if you normally get a large refund and you would like more money in your paycheck. If you owed tax when you filed, you may need to increase the Federal income tax withheld from your wages. Use the IRS Withholding Calculator at IRS.gov to complete a new Form W-4, Employee's Withholding Allowance Certificate.
Store your return in a safe place. Put your 2019 tax return and supporting documents somewhere safe. If you need to refer to your return in the future, you'll know to find it. For example, you may need a copy of your return when applying for a home loan or financial aid. You can also use it as a helpful guide for next year's return.
Organize your records. Establish one location where everyone in your household can put tax-related records during the year. This will avoid a scramble for misplaced mileage logs or charity receipts come tax time.
Shop for a tax professional. If you use a tax professional to help you with tax planning, start your search now. You'll have more time when you're not up against a deadline or anxious to receive your tax refund. Choose a professional wisely. You are ultimately responsible for the accuracy of your return regardless of who prepares it.
Consider itemizing deductions. If you usually claim a standard deduction, you may be able to reduce your taxes if you itemize deductions instead. If your itemized deductions typically fall just below your standard deduction, you can "bundle" your deductions. For example, an early or extra mortgage payment or property-tax payment, or a planned donation to charity could equal some tax savings.
Keep up with changes. Find out about tax law changes, helpful tips and IRS announcements all year by visiting IRS.gov
A little tax planning now can save a lot of headaches next April, and maybe for years to come.
Barry Lisak is an IRS Enrolled Agent, meaning that he has passed special U.S. Treasury Department exams that qualify him to represent clients dealing with audits or tax-resolution cases. Any questions can be directed to him at (516) TAX-SAVE, or firstname.lastname@example.org.
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