02/25/2022
You might think there’s no need to worry about the next tax season just yet, but with the next season just around the corner, it pays to be prepared so you’re not caught in a last-minute rush. There are a few important things to know in order to make your 2022 a little bit smoother, especially after COVID-19’s exemptions, extensions, loans and stimulus checks. Things are stabilizing, but it’s important to stay up to date with every change.
That’s why Money Services is here with important tax season advice to help you prepare. From the key dates you need to put on your calendar to advice to help you save and stay safe, as well as handy tax savings tips to help you through a difficult year, we’ve got you covered.
Let’s break down tax season 2022, so you can know what to expect.
The key dates to be aware of
There are a few major tax dates you need to be aware of for tax season 2022, especially after all the changes and uncertainty brought about by COVID-19. While we’re still a far cry from normalcy, things are looking less eventful than 2021.
- January 31, 2022, Documentation Received
You can expect to receive all your documents by this date, including your W-2, 1099 Income, and tax deduction forms and documentation.
- April 18, 2022, 1st Quarter Estimated Tax Payment Due
If you’re self-employed or are required to pay quarterly estimated taxes, you will need to have your quarterly estimated tax payment sent by this date.
- June 15, 2022, 2nd Quarter Estimated Tax Payment Due
- September 15, 2022, 3rd Quarter Estimated Tax Payment Due
- October 10, 2022, Individual Tax Return Extensions Due
If you have a filing extension for your 2021 tax return, you need to complete and send your tax return by this date.
- January 15, 2023, 4th Quarter Estimated Tax Payment Due
If you’re self-employed or are required to pay quarterly estimated taxes, you will need to send your 4th quarter estimated tax payment by this date.
Tax season advice
There’s a ton of tax season advice out there, but some of the best is to simply prepare and stay ahead of the curve. To start off right, start collecting your tax documents in January. This includes documents like acknowledgments of charitable contributions.
You’ll want to make sure you still have access to bank or brokerage accounts too. If you don’t already have one, an online IRS account can help you with preparing your returns.
Submit your taxes as early as possible, as you’ll have a quicker turnaround and more room to adjust if anything goes wrong. You don’t want to end up scrambling for information at the last minute; it could cost you.
If you intend to find a tax professional, do so early so you can find the right person and price for you. The later you look for someone, the fewer options you’ll have, and you may be at the mercy of raised rates.
Tax saving tips
While it’s necessary to pay taxes, not everyone is thrilled to give away their hard-earned cash. Thankfully, there are a few handy tips that can help lessen the sting of taxes on your earnings.
- Charitable contributions
If you keep note of any charitable contributions, including non-cash contributions such as donated clothing, sports gear, household items, building materials, or food, you can lower your tax bill.
- Send your returns on time
There are heavy penalties for missing tax return deadlines, including interest, forfeit of refunds, or additional charges. Don’t pay more than you have to.
- College funds
Committing money to a 529 plan could trim a few bucks from your tax bill. While you can’t deduct any contributions on your federal income tax, you may be able to on your state return. Just consider any gift tax limitations.
- Take note of medical expenses
If a qualified medical expense is more than 7.5% of your adjusted gross income for that tax year, you can deduct it. Make sure you keep those receipts.
- Deduct stock losses
If you have a realized capital loss after selling stock, you can use it to reduce your tax bill. However, this isn’t about unloading stock from your portfolio just to buy it back. Tax avoidance is not the same as intelligent investing, and the IRS can take back any deductions.
Common tax scams to avoid
It’s not uncommon to receive calls from certain less than honest entities, claiming to be the IRS. If you’re contacted by the IRS by email or phone, they’re almost certainly not the IRS or any other government organization. The IRS will contact you almost exclusively by U.S. mail.
We’re always looking for tax savings tips, but when seeking a paid tax preparer, you may come across claims of tax refunds that seem too good to be true. They probably are, and whether it’s a mistake or fraud, you could end up responsible for any discrepancies.
Checking and validating a tax preparer’s credentials is essential for your financial security. The IRS website also has a list of registered paid tax preparers that you can trust.
FAQs
Where’s my tax refund?
If you’re concerned about the status of your tax refund, the IRS has a “Where’s my Refund” tracker. Either visit the IRS website or follow this link to track your refund. You’ll need your social security number, filing status, and exact refund amount.
How do I calculate my tax?
There’s always pen and paper, but the easiest way would be with an online tax calculator. Once you have all your information, simply enter it into the calculator. The IRS also provides a Tax Withholding Estimator that can ensure you have the right amount of tax withheld from your paycheck.
What is an IRS 1040 form?
The 1040 form is an official document from the IRS that U.S. taxpayers can use to declare their annual income tax returns. There are instructions for submitting form 1040 on the IRS government website, including any revisions.
