4 Key Strategies to Evaluate and Plan for Next Tax Season
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Here at Hallows & Company we understand that tax season can be a stressful time for many individuals and businesses. The preparation and filing of tax returns can be a time-consuming process, and the fear of making errors or missing important deadlines can add to the pressure. However, there are several ways to evaluate tax season and start preparing for next year, which can help reduce stress and improve overall tax compliance. Here are four key strategies to evaluate tax season and prepare for the next year.
1. Review your previous tax returns
One of the most important steps in evaluating tax season is to review your previous tax returns. This can help you identify any errors or omissions that were made, as well as any areas where you may have missed out on deductions or credits. By reviewing your previous returns, you can also get a better understanding of your overall tax situation and identify any changes that may need to be made in the future. If you are like many people who feel like looking at your tax return is like looking at a foreign language, no worries. Here at Hallows & Company, we’ve got your back! We can sit down with you any time and clarify the language of a tax return.
When reviewing your previous tax returns, we pay close attention to the following:
Income: Make sure that all sources of income have been reported accurately, including wages, investment income, and any other forms of income.
Deductions: Check to see if you have claimed all deductions that you are eligible for, including those related to charitable contributions, medical expenses, and business expenses.
Credits: Look for any tax credits that you may have missed, such as the Earned Income Tax Credit or the Child Tax Credit.
Errors: Check for any errors or omissions, such as incorrect Social Security numbers or mathematical errors.
Our tax professionals can spot errors you may have made in preparing your tax return and help you focus on future savings.
2. Keep accurate records
Another important step in preparing for tax season is to keep accurate records throughout the year. Preparing for next year’s tax season starts now! Keeping accurate records can help ensure that you have all the information you need to file your tax returns accurately and on time. When keeping records, be sure to include the following:
- Income: Keep records of all sources of income, including pay stubs, 1099 forms, and investment income statements.
- Expenses: Keep receipts and other documentation for all expenses related to your income, including business expenses, medical expenses, and charitable contributions.
- Tax Forms: Keep track of all tax forms that you receive, such as W-2s, 1099s, and K-1s.
If you are like many other individuals and businesses you hate having to keep records and do the bookkeeping and accounting. No need to fear! Hallows & Company has a whole staff that focuses on taking that burden from you so you can focus on what is most important: Making money in your business!
3. Stay up to date with tax law changes
Tax laws are constantly changing, and it is important to stay up to date with these changes to ensure that you are filing your tax returns correctly. This includes changes to deductions, credits, and other tax-related provisions. Some of the key changes for the 2022 tax season include:
- An increase in the standard deduction for single filers to $12,950 and for married couples filing jointly to $25,900.
- An increase in the Child Tax Credit to $3,000 for children between the ages of 6 and 17 and $3,600 for children under the age of 6.
- -An increase in the maximum contribution limits for 401(k) plans to $20,500.
Hallows & Company accountants are constantly trained and staying up to date with new tax laws. We can help you keep up with these changes, and by staying up to date with these changes, you can take advantage of new deductions and credits and ensure that you are filing your tax returns accurately.
4. Work closely with a tax professional….all year long!
One of the major focuses at Hallows & Company is making sure we communicate openly with our clients all year long. Since we never bill hourly, you can call, email or Zoom call your tax professional at Hallows & Company any time to discuss you situation and plan all year long. If you are feeling overwhelmed by the tax season, consider working with a Hallows & Company tax professional. We can help you navigate the complex tax laws and ensure that your tax returns are filed accurately and on time. We can also provide valuable advice on tax planning strategies, such as retirement planning and estate planning.
Check out our services on our Web site at www.hallowscompany.com to see how we can get you prepared for next year’s tax season. After all, it will be here before you know it!
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