General Tax Tips For the Year 2024

Preparing for tax season doesn’t have to be a daunting task. Follow these simple guidelines, so you can be prepared and maximize your return.

1. Stay organized. Keep all your tax documents organized and in one place throughout the year by creating a system for tracking expenses, receipts, and income statements. You can do this by utilizing expense tracking software, digitizing receipts and organizing them by date and category, and creating a template for income statements or use accounting software that generates them automatically. Be sure to include all sources of income such as wages, sales revenue, interest, and investments. QuickBooks Online is an accounting software that can accomplish all of the above and more.

2. Be aware of important deadlines. Understand the deadlines for filing your taxes, including extensions if needed. Stay informed about quarterly estimated tax payments. The tax filing deadline for 2023 income, including filing an extension is April 15th. Quarterly estimated tax payments are typically due in April, June, and September of the current year, and January of the following year.

3. Contribute to retirement accounts. Contribute to tax-advantaged retirement accounts such as 401(k)s, IRAs, or Roth IRAs. By maximizing your contributions, you can lower your taxable income.

4. Take advantage of deductions and credits. Look for tax credits you qualify for, such as the Earned Income Tax Credit or Child Tax Credit.

5. Consider charitable contributions. Make donations to qualified charities and keep records of your contributions. You can deduct charitable donations from your taxable income, but be sure to follow IRS guidelines.

6. Review Health Savings Accounts (HSA’s). If you have an HSA, ensure you’re maximizing contributions. HSA’s offer tax advantages, allowing you to save for medical expenses with pre-tax dollars.

7. Be aware of capital gains. By understanding how capital gains on investments are taxed, you can minimize tax liability. Carefully consider the timing and selling of investments.

Following these simple guidelines and enlisting the help of a financial professional can ensure proper tax filing and peace of mind.