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Put these on your to-do list.
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Though we’re already a couple of weeks into 2023, a lot of us are still adjusting to the new year (and trying to remember not to write “2022” when we fill out forms or send out checks). And at this point, you may be focused on trying to tackle some of the New Year’s resolutions you set for yourself — things like getting on a budget and growing your savings.
But January is actually an important time to focus on your taxes. Even though 2022 returns aren’t due until April 18, there are steps you’ll need to take ahead of that deadline. Here are three key moves to put on your to-do list ASAP.
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1. Make your final estimated tax payment for 2022
If you’re self-employed, it’s on you to pay taxes to the IRS on an ongoing basis. And you should know that your final estimated quarterly tax payment for 2022 is due on Jan. 17 this year. (Normally, it would be due on the 15th, but that’s a weekend, and the following Monday is Martin Luther King Jr. Day, so you get a touch more time.)
Failing to pay your estimated taxes could subject you to penalties when you file your 2022 tax return. So don’t miss that deadline. Instead, look at your bank account and invoices, and figure out what you owe for the final quarter of the year.
2. Start gathering your 2022 tax documents
It may be several months before 2022 taxes are due. But you don’t want to scramble at the last minute to come up with the paperwork you need.
That’s why January is a good time to make a list of the tax documents required to file your return and start assembling them. You may, for example, have to wait on some clients to issue your 1099 forms, but you can probably log onto your bank account and access your 1099 to report interest income. Similarly, if you pay your mortgage online, you can probably download your mortgage interest statement for 2022.
3. Hire an accountant if you don’t have one yet
If your taxes are very simple, then it may be possible to file without the help of a professional. But if you’re self-employed, you’ll generally want to have an accountant assist with that process.
For one thing, an accountant can help you avoid tax return errors that could lead to an audit. Plus, an accountant might be able to find deductions you wouldn’t have known about yourself.
But don’t wait until tax season really kicks into gear to find yourself an accountant. Tax professionals are already starting to get inundated, and if you wait until February or March to start looking for one, you might get shut out.
While January isn’t exactly known as “tax month” the way April is, it’s still a good time to focus on IRS-related matters — especially if you have a quarterly tax payment to make. Tackle these moves to put yourself in a great position to not only avoid penalties, but get your 2022 return filed in a timely, smooth manner.
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Our independent analysts pored over the perks and user reviews for the most popular tax provider services to land on the best-in-class picks to file your taxes. Get started by reviewing our list of the best tax software.
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