You may have heard us say this before, but tax season isn’t just about filing forms. It’s also an ideal opportunity to take a proactive look at your finances and make smart decisions before your return is finalized.
While you gather your documents to file, check out these additional tips: you may uncover tax-saving opportunities many people don’t realize are available.
Start With a Reality Check (February)
Before diving into tax documents, take a step back and review how this year compares to last year. Beyond gathering W-2s and 1099s, look at last year’s return for items such as capital loss or charitable contribution carryforwards.
Also, be sure to review your withholding and estimated payments (if those apply). A large refund can sometimes indicate missed planning opportunities, such as withholding less so you can invest those funds.
February is also a good time to confirm beneficiaries on retirement and investment accounts, an often-overlooked task that plays a critical role in long-term planning.
Identify Life Changes That Affect Taxes (February–March)
Taxes are impacted by much more than income alone. Changes such as side or freelance income, updates to health insurance, education expenses, or financial support provided to adult children or aging parents can all influence your tax outcome.
These details often open the door to credits or planning strategies that are easy to miss without a proactive review, so make sure to tell your advisor if a life change impacted you financially.
Work with an Advisor to Look for Last-Minute Planning Opportunities (Before April 15)
Even after the calendar year ends, there may still be planning moves available. Depending on your situation, this could include making Traditional or Roth IRA contributions before the filing deadline, reviewing capital gains and losses together rather than separately, being intentional about charitable giving, or coordinating tax decisions with investment and insurance planning.
This is where a tax-smart advisor can help you strategize and make recommendations that fit your situation.
Use Filing as a Planning Conversation (April and beyond)
Filing your return shouldn’t be just a compliance task. It’s the perfect time to ask forward-looking questions:
- Are you paying more tax year-over-year?
- Do your retirement contributions align with your current tax bracket?
- Could better planning now help reduce surprises next year?
The most valuable tax planning often happens before you file — and sometimes in places people don’t think to look. Tax season a great opportunity to explore how tax-intelligent financial planning can support your bigger financial picture.
Feel free to reach out to schedule a conversation!