09 Jan 2023 Planning For Your 2022 Tax Return
Authored by Haynie & Company Partner Bernard Abercrombie, CPA
With the new year comes the necessity to start thinking about filing your tax returns for 2022, whether you prepare it yourself or hire a professional. We want to provide some helpful hints for those hiring a professional on getting it done as quickly and painlessly as possible, both for you and your preparer.
The filing deadline for 2022 individual tax returns is April 18, 2023, due to the 15th falling during a weekend and a holiday on Monday, April 17th in Washington DC. Your individual tax return can be extended until October 16th. As a reminder, an extension is only an extension of the time to file, not an extension of time to pay any amounts owed. Anything one might owe should be paid on or before the April 18th deadline or interest and penalties will accrue.
Many tax return preparers send out organizers in January to help them accumulate the data for the return. These organizers usually provide insight into what was on the prior year’s return to help evaluate what documents you should be looking for to prepare for the current year’s return. Additionally and probably more importantly, the organizers will have questions that your preparer will need for you to answer. If you don’t do anything else with the organizer, you should make sure those questions are answered, otherwise, your preparer will have to follow up, delaying the completion of your return.
Prepare Tax Documents Early
During January and early February, your tax documents will start arriving such as your W-2s, statements for interest, dividends, stock transactions, retirement plan distributions, Social Security statements, partnership K-1, and so on. We strongly suspect your preparer would prefer that you accumulate those documents and send them all (or almost all) at one time, as opposed to sending them one by one as you receive them. Make sure you provide those documents allowing the preparer ample time to prepare the returns, keeping in mind that when you provide them, they may have dozens if not hundreds of returns already there that will need to be handled before they get to yours. If you wait too long to get your information in, your preparer may have no choice but to file an extension just due to the volume of returns they already have in-house.
Expectations After Filing
Once your return has been prepared and sent to you for your review, you should review it as soon as possible so that you can identify anything that you don’t understand and/or may need correction. Holding on to it and waiting until just before the deadline and identifying an issue doesn’t give the preparer time to properly address those issues and make any necessary corrections.
Once your return is finalized and filed with the Internal Revenue Service, remember that your preparer has no control over when the IRS processes your return or issues a refund. They can assist you in getting information on the status of your return, but they are unable to do anything until approximately ten weeks after your return was filed and accepted by the IRS.
We at Haynie & Company are happy to assist you with your tax planning and preparation.
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