With the end of the year quickly approaching, it is the perfect time to start the process of filing your 2022 income tax returns. The below are some steps to facilitate this process.
Before Year End
- Confirm your employer, bank, and other payors have your current mailing address and email address.
- Make sure you understand how the issuer will send the tax forms to you, whether it is paper mail, electronically, or via their website.
Gathering Tax Records
- Year-end tax forms typically begin arriving in late January either by mail or are available online. Review each tax form for accuracy.
- 1099K tax forms will now be issued when business transactions exceed $600. These forms are sent by third-party payment networks such as PayPal, Venmo and Zelle. This may be the first year you receive this form, so review it carefully. Money received through third-party networks from friends and relatives as gifts or reimbursements is generally not taxable.
- Once you review your W-2s, 1099s and other tax forms, please report any errors to the issuer. The IRS cannot correct these amounts. If the form is in error the issuer will correct it and give you an amended form.
- Collect your forms in one place (whether in a paper folder or electronic location) so that they are ready to send to your preparer. Keep a list of missing items.
Withholding and Estimated Payments
- Taxpayers who had life changes in 2022, like getting married, divorced, welcoming a child, or taking on a second job, should review whether their withholdings and estimated tax payments are accurate. Contact your tax advisor for a year-end review.
- You can make an estimated tax payment by January 17, 2023, to cover any underpayment of estimated taxes. This can reduce your underpayment penalties.
Don’t wait until the last minute to start the process of filing your 2022 income tax returns. If you have any questions, we’re here to help. Please do not hesitate to reach out to our trusted experts today.
This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.