Since the passage of the Tax Cuts and Jobs Act in December 2017, which went into effect January 1, 2018, the 2018 tax season is going to be entirely its own beast for many filers. Considering taxes aren’t typically everyone’s favorite pastime, major tax structure changes have left filers worried, overwhelmed, and stressed regarding the completion of their tax return.
However, you can start preparing right now for this new kind of tax season, taking your time to approach your filing so you have all your ducks in a row. So, what exactly are those preparatory measures? We’re going to look at 4 options for you to consider pursuing below:
Organize All Necessary Documents:
When stating things like donations, withholdings, income, etc., it is recommended that you attach proof of the numbers you are claiming. These documents can include W2s, 1099s, receipts for deductions, and the list goes on.
With the new Section 199A Deduction, your bookkeeper will need a new kind of supportive document to claim that deduction for this completed tax season. As a complex calculation, you can start working with them right now to ensure you both have plenty of time to navigate the clause before April 15th.
Investment Portfolio Alterations:
The nature of financial investment is always changing in this country, especially when a new tax code is pushed through Congress. In coordination with your financial advisor, we recommend sitting down, analyzing your current investments, and rebalancing what is necessary to save the most through tax season. Your financial advisor will be able to assist you as you continue to meet your objectives while minimizing the taxes you owe on each investment.
Make Those Businesses Purchases:
As a business owner, if you are in need of additional deductions to get your taxes where you want them to be, consider making equipment purchases or investments before the year closes out. But, be sure to consult with a professional to guarantee that these purchases do quality as deductions on an IRS tax return. No one wants to consider the possibility of an audit in the future.
Review All Charitable Contributions:
As part of the new Tax Cuts and Jobs Act, standard deductions are increasing, thereby encouraging people to overlook the possibility of “itemizing” for their taxes this year. But, that is not a one-size-fits-all statement. If you find that your charitable giving and donations exceed the standard deduction, the old school itemization method might be right for you in this case. Of course, make sure you have proper documentation to back up your claim of excess charitable contributions.
The Ashcraft Firm
Although we know no one likes to talk about taxes, prepare taxes, or review taxes, it’s a necessary evil as a U.S. citizen. That’s why we are here to help you navigate the 2018 tax season with flying colors. It all starts with some methodic organization and plenty of time to ensure everything is where it needs to be. If you need any assistance, please do not hesitate to reach out and give us a call.