COLUMBUS, Ohio (WCMH)–As the end of the year approaches, tax experts warn the clock is ticking for taxpayers who want to minimize what they’ll pay next spring. Here are the five most important things you should do now to save you time and money come tax season.
“It’s kind of year three of the three toughest years we’ve seen for taxpayers, for all Americans really,” said Mark Steber, chief tax information officer at Jackson Hewitt.
There are three important tax law changes that took effect during the pandemic which are still in place.
“Good faith and goodwill tax law changes that tried to make everybody’s life better and provide some relief, but all that comes to fruition on the tax return,” said Steber.
Five tasks to accomplish before the end of the year
- Start early and take note of any additional pandemic relief assistance you received or life changes that occurred in 2021. Elements such as getting married, getting divorced, or having a child.
- Estimate what your refund should look like
- Consider investing in your tax-advantaged retirement accounts before the end of the year
- Make a charitable donation
- Reach out to a tax professional if you fell victim to identity theft, unemployment scheme or some other type of fraud in 2021
“Put a little bit more money in your 401K plan on those last two paychecks, that comes off your W-2 and is an immediate tax benefit and return on your investment,” Steber said.
This year, as a catch on from last year, you don’t have to itemize to take a charitable donation. You do have to have some documentation like a canceled check or other collaborative evidence that will serve as proof of donation.