Hello everyone! This is Roger Brooks at Strategic Investment Management.
It’s time to start preparing for tax season! Here are seven tips to get ready for the 2024 tax filing deadline on Monday, April 15.
Step #1. UNDERSTAND YOUR FILING STATUS Your filing status determines your 2024 tax rates, standard deduction, and eligibility for various credits and deductions. The IRS has five main filing statuses that all taxpayers fall under. If you’re not sure about your status, you can check out the IRS website to find out.
Step #2. ENSURE YOUR PERSONAL INFORMATION IS UPDATED If you've recently moved, gotten married, divorced, or legally changed your name, don’t forget to update your personal information with the IRS and the Social Security Administration.
Step #3. GATHER AND ORGANIZE YOUR TAX DOCUMENTS Gather together any income documents from the last year, including W-2 forms, 1099 forms, Form 1098 if you're a homeowner, Form 1098-E if you have student loans, Form 5498 if you contributed to an IRA in 2023, and any business expenses if you’re self- employed or own a small business. Additionally, having last year’s taxes, your Social Security or tax ID numbers, and your bank account numbers on hand can make filing easier.
Step #4. DECIDE TO FILE YOURSELF OR HIRE A TAX PREPARER The decision to file your taxes independently or seek professional help depends on the complexity of your financial situation.
Step #5. MAXIMIZE YOUR IRA CONTRIBUTIONS Contributing to IRAs can lower your taxable income in the 2024 tax season, so be sure to maximize your contributions before the filing deadline in April.
Step #6. UNDERSTAND WHERE YOU CAN CLAIM DEDUCTIONS AND CREDITS Deductions help reduce your taxable income, which generally means a lower tax bill. Tax credits are similar to deductions, but they provide dollar-for-dollar cuts in any tax you owe.
Step #7. ADJUST YOUR WITHHOLDING FOR 2024 Review your W-4 to ensure you're withholding the right amount from your paycheck. The IRS has a Tax Withholding Estimator to help you figure out the right withholding for your situation. Starting early and staying organized can make the tax filing process much less stressful.
If you have any questions, don't hesitate to reach out to a tax professional or visit our office. See you next month!