What : Taxpayers can consider resolving to improve their tax condition in 2022 after deciding to eat healthier and exercise more. With the US Congress currently debating major year-end tax reform, it's unclear what tax regulations will look like in 2022, or even in some aspects in 2021. Even so, a little forethought can help a taxpayer's tax status in 2022.
Why : The majority of the time spent preparing a tax return is spent figuring out how to maximize the tax savings that a taxpayer is entitled to, whether through exclusions, deductions, or credits against the taxes owing. Organizing for the current and future tax filing seasons early can save taxpayers time and money.
The following are some of the resolutions that taxpayers may want to examine.
• Organize tax documents : Many of the deductions and credits that people believe they are entitled to on their tax return require documentation, some of which may need to be collected at the time of the transaction. According to their disaster preparedness plan, taxpayers should vow to gather these documents throughout the year and preserve them in a safe place.
• New documents : Taxpayers should make a commitment to maintain track of a range of new papers that they may require while submitting their tax return. In addition to receiving letters from the Internal Revenue Service (IRS) regarding advance Economic Impact Payments for the recovery rebate credit, many taxpayers also received letters from the IRS regarding advance child tax credit payments, which must be taken into account when calculating the child tax credit on the tax return. In January 2022, the IRS is likely to send another letter - Letter 6419 - about advance child tax credit payments received by a taxpayer.
• W-4 form : When taxpayers start a new employment, they fill out Form W-4 with their employer to determine how much income tax withholding is withheld from their pay. Taxpayers should make a commitment to maintain their W-4 forms up to date by amending them after key life events such as marriage, the birth of children, the purchase of a home, and so on.
• Tax deadlines : Taxpayers should make a commitment to stay vigilant and prepared for tax deadlines. Returns must be filed by certain dates, and estimated taxes must be paid by certain dates. Many tax benefits, such as charitable contributions and making maximum 401(k) contributions, have year-end deadlines to meet. There are extended tax deadlines for many additional tax benefits, such as IRA contributions.
• IRS correspondence : Taxpayers should vow to react to IRS letters concerning their tax returns in a timely manner. If you wait too long, you may face extra fines and interest.
• Consider hiring a tax resolution specialist for any tax problem help : Taxes are becoming increasingly difficult. IRS tax problem solvers can assist you in identifying tax savings opportunities that you may have overlooked, allowing you to keep your New Year's tax resolutions.
Who : IRS tax problem solvers
at MC Tax Relief
can discuss the many tax remedies that you could explore in order to have a better tax year in 2022. Get in touch with us for any tax problem help today!