21 December 2023

Tips for Taking Care of Taxes at the Last Minute

By Ronald Smith

Are you feeling a bit overwhelmed by your taxes? Don’t worry, I’ve got your back. Here are some helpful tips for managing your taxes in a hurry.

First things first, make sure you have all the necessary documents ready. Gather up your W-2 forms, receipts, and any other important paperwork that relates to your taxes. It’s important to have everything organized and in one place, so you don’t waste time searching for things later.

Next, it’s time to tackle those deductions. Deductions are a way to lower the amount of money you owe in taxes, so they’re definitely worth looking into. There are plenty of deductions available, like charitable donations or mortgage interest, so be sure to explore what options are available to you.

If you’re self-employed or have a side hustle, make sure you’re aware of all the deductions you’re eligible for. Things like business expenses or home office deductions can make a big difference in how much you owe. It’s also a good idea to keep track of your income and expenses throughout the year, so you’re not scrambling to figure it out at the last minute.

When it comes to actually filing your taxes, there are a few different options. You can do it the old-fashioned way and fill out paper forms, or you can use tax software to make the process a bit easier. There are plenty of user-friendly options out there, so find one that works for you.

Don’t forget about the deadline! April 15th is the usual deadline for filing your taxes, but it can vary depending on certain circumstances. Make sure you know when your deadline is and mark it on your calendar. You don’t want to miss it and potentially incur penalties.

Finally, if you’re really feeling overwhelmed or unsure about your taxes, don’t hesitate to reach out for help. There are professionals out there who specialize in tax preparation and can help guide you through the process. They can ensure you’re taking advantage of all possible deductions and help relieve some of the stress.

So there you have it, some tips to help you manage your taxes when you’re down to the wire. Remember, staying organized, exploring deductions, and seeking help when needed are key to getting through tax season smoothly. You’ve got this, and I’m rooting for you!

Tips for Taking Care of Taxes at the Last Minute

Listen up! The year is coming to an end, but you still have a chance to take some smart actions that can lower your 2022 tax bill. First things first, it’s time to have a chat with your CPA or tax adviser.

Last-Minute Tips for Lowering Your 2022 Taxes

Here are a few things you should discuss with your tax adviser:

Upgrade your equipment

If your equipment is old and constantly needs repairs, it might be time to consider buying new equipment. Not only will you enjoy better features and save on energy costs, but it’s also good for the environment.

Start a retirement plan

If your business doesn’t have a retirement plan in place, you still have time until the extended due date of your 2022 return to set one up and contribute funds. The sooner you take action, the sooner you – and your employees covered by the plan – can start saving for retirement with tax advantages. Here are two tax breaks to think about:

    In the world of taxes and business, there are some benefits available to small business owners like me. Let me break it down for you in simpler terms.

    First, there’s something called a deduction for employer contributions. This means that the money I put into my employees’ accounts is tax deductible. There are limits to how much I can deduct, but this can help me save money when it comes to taxes.

    Next, there’s a tax credit for setting up a plan. If I don’t already have a retirement plan in place and I decide to create one that covers at least one employee who isn’t an owner, I can receive a tax credit for three years. And if I choose to have an automatic enrollment 401(k) plan, there’s an additional credit. These credits directly reduce the amount of taxes I owe, which is a great way to save even more money.

    If you want more information on the specific rules for retirement plans for small businesses, you can check out IRS Publication 560. Just keep in mind that it might not include all the latest information for 2022, so it’s always a good idea to stay updated.

    Now, let’s move on to a different topic altogether – buying a new vehicle.

    If you’re thinking about getting a new vehicle for your business, now might be a good time to do it. And if you decide to go for an electric vehicle (EV), you could be eligible for a tax credit of up to $7,500, even if you use the car partly for personal driving. But here’s the catch – you need to act now because there’s a condition called the final assembly requirement that the vehicle must meet to qualify for the credit. Luckily, the Department of Energy has a list of EVs that meet this requirement and could potentially get you the credit.

    However, if you wait until 2023 to make your purchase, there will be new rules for the EV credit. These rules will include restrictions on income and the purchase price, which could limit or even eliminate the credit altogether.

    Consider Making Charitable Contributions

  • Cash donations. When it comes to donating money, there are a few things to keep in mind. If you own a C corporation, the amount you can donate is limited to 10% of your taxable income in 2022. The limit used to be 25% in 2021, but that changed. If you own a pass-through entity, like a partnership or an S corporation, you can deduct the donations on your personal tax return. However, to qualify for this deduction, you need to itemize your deductions instead of taking the standard deduction. If you are an owner and want to deduct cash donations, there is a limit – you can only deduct up to 60% of your adjusted gross income. Keep in mind that the 100% limit that applied in 2021 is no longer in effect.
  • Property donations, including donations of excess inventory. Donating property can be a bit more complex. Depending on what you donate, the deduction you can claim may be limited or even non-existent. However, even if the deduction is small, your donation can still greatly benefit the charity you choose to support.
  • Time off for employees to do charitable work. Giving employees the opportunity to take time off and engage in charitable activities within the community can be beneficial for everyone. If this time off is paid, the regular rules for payroll taxes still apply.

To learn more about charitable deductions, you can refer to IRS Publication 526, although please keep in mind that it may not include the most up-to-date limitations for 2022.

Wrapping it up