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Learn How to Avoid These 6 Common Tax Errors

Knowing how you need to file your taxes depends on your income and filing status, as well as which deductions and credits you can claim. In this free ebook, we share some common errors to avoid.

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Tax Checklist – 5 Actions to Take Before April’s Filing Deadline

Tax Checklist – 5 Actions to Take Before April’s Filing Deadline

February 27, 2023

If you are like most of my clients, you started to get some of your tax filing documents. If you are due a refund, you are probably eager to file and get your money back. As an experienced, well-trained CERTIFIED FINANCIAL PLANNER™ professional I am talking with more and more clients about tax-smart saving, investing, and retirement income distribution strategies.

Here are a few ideas that might make the process go smoother.

Gather Your Tax Documents

Everybody has some documents, and the IRS expects your tax return to match the documents that it has on file. So, be sure to wait until you have all the documents that apply to your situation. Specifically:

  1. If you are an employee, you will have Form W-2 showing your wages and all taxes sent to the IRS on your behalf.
  2. If you are an independent contractor, you will have Form 1099 – NEC (non-employee compensation)
    1. You will also want evidence of any quarterly tax payments you made during 2022.
    2. You will want business accounts that show all business expenses you might deduct from your income.
  3. If you are part of a business partnership, you may receive IRS FORM K-1. Those are required to be mailed by March 15.
  4. If you have investment accounts, IRAs, or bank accounts you will get IRS FORM 1099.
    1. Many of those documents will mail by 31 January.
    2. Many types of investment securities report tax information later, so expect to get mailings up to March 15.
    3. Check with your fiduciary financial planner or the custodian of your accounts for your details.

If you are charitably minded, you should make a list of all charitable contributions. You might include those to reduce your taxes.

Consider an extension

  1. Why not put off paying taxes as long as possible? Just remember, that you can delay filing your tax return, but you are expected to have paid all taxes due by the 18 April deadline.
  2. If your records are not complete and you expect to need to amend your return, you might be better off filing an extension and only filing once. Consult a tax advisor about your situation.

If you decide to extend you will have until 16 October 2023 to file your return.

Reduce your taxable income for 2022 with an HSA contribution

  1. If you have high-deductible health insurance, you may qualify for a health savings account (H.S.A.). Contributions are pre-tax and the money can be used for medical expenses free from income tax.
  2. You may add to an H.S.A. account for 2022 up to 18 April 2023.
  3. Contributions Limits for 2022:
    1. Individual – $3,650
    2. Married Couple – $7,300

Better than 55 Catchup -- $1,000

Max-Out Your IRA

  1. If you are better than 50 years old, you can contribute $7,000 per person per tax year to an IRA.
  2. If you are less than 50 years old the maximum is $6,000 each.
  3. Contributions can be made up to 18 April 2023 and traditional IRA contributions will directly reduce your taxable income.
  4. IRA contributions are subject to income limits and can be reduced in the event one, or both, of the married couple is covered by a retirement plan through work.
  5. Roth IRAs do NOT get a tax deduction in the year you make them, but the account grows tax-deferred, and distributions are free from all tax. Your contributions are limited based on family income.

Think About Next Year

  1. While you gather your tax documents you may notice things you would like to change.

  2. Maybe your withholding at work does not match your needs.

  3. Maybe your investment accounts are generating too much taxable income.

  4. As a fiduciary financial planner, I offer all my clients tax strategy analysis to identify tax-smart ways to save and invest. If you would like to talk about reducing your taxes next year, I would love to visit. Just follow this LINK to find a time for us to talk.

  5. Start planning now and you have much more time to implement any changes.

For most people, the idea of reducing taxes, or at least, making the tax filing process smoother is pretty important. Maybe you would benefit from some fiduciary financial planning advice.

Yes, I am a CFP® professional. I’m always a fiduciary and I work on a fee basis. And yes, I’m still taking on a few great families to be part of my financial planning practice. If you would like to talk with me about improving your tax management strategy, I would love to do that. Just follow this LINK to find a time for us to talk.

If this article has you thinking about your own circumstances, contact my office at I am always happy to meet with people who are working on their retirement plans. Dunncreek Advisors does not provide legal or tax advice, nor is this article intended to do so.