You certainly don’t need one more item on your to-do list. But attention to a few items right now can help make tax-filing season much more pleasant.
Here are a few things that can make an impact on your 2019 tax liability:
Make a Tax Payment
Taxpayers who paid too little tax during 2019 can still avoid a tax-time surprise by making a quarterly estimated tax payment now. The deadline for making a payment for the fourth quarter of 2019 is Wednesday, Jan. 15, 2020. If you missed a required estimated tax payment earlier in the year, making a payment as soon as possible will usually lessen and may even eliminate any possible penalty.
The IRS has seen an increasing number of taxpayers subject to estimated tax penalties and urges taxpayers to check into their options to avoid these penalties. This is especially important for anyone who owed taxes when they filed their 2018 return and did not adjust their 2019 withholding or estimated taxes. Use the Tax Withholding Estimator to look back at 2019. If withholding amounts and estimated tax payments won’t cover your estimated tax liability, making a quarterly estimated tax payment now can help. The Form 1040-ES, Estimated Tax for Individuals has a worksheet to help you calculate your estimated payments. Visit irs.gov/payments to explore payment options.
Report an Address Change
Get Ready for Your Refund
If you anticipate a refund, combining direct deposit with electronic filing is the fastest way to receive your money. But be careful not to count on getting a refund by a certain date, especially when making major purchases or paying other financial obligations. Different factors can affect your refund. If you claim the Earned Income Tax Credit or Additional Child Tax Credit, the IRS cannot issue refunds before mid-February. See irs.gov/refunds for more information.
Now that you’ve got your ducks in a row for April 15, consider how you can help others do the same. The IRS and its community partners are looking for volunteers for the Volunteer Income Tax Assistance program, which offers free tax return prep to eligible taxpayers who generally earn $55,000 or less, and Tax Counseling for the Elderly, which focuses on tax issues unique to seniors. Volunteers do not need prior experience. To learn how to volunteer or to host a free tax preparation site, visit irs.gov/volunteers.
Remember, tax planning should be a year-round endeavor. It’s never too early to start thinking about your 2020 tax liability. Talk to your CRI tax advisor about how to develop a strategy that will put you and your family in the strongest possible tax position.