First – Here are Important tax dates to remember
Tax season is filled with dates and deadlines, but here are some you should definitely keep in mind:
- January 2023 marks the beginning of the 2022 tax season. This is when the IRS will start accepting and processing 2022 federal tax returns
- January 31st is the deadline for your employer to issue your 2022 W-2. The IRS imposes this deadline to make sure you have enough time to organize and file your taxes
- April 3rd is the deadline to take any required minimum distributions from your retirement accounts. If you turned 72 in 2022, you may need to take a required minimum distribution. The amount required is based on age and your December 31, 2021 account balance.
- April 18th is tax day. It’s typically April 15th, but this year that falls on a Saturday so you get a little more time. Make sure you file your tax return or file to get an extension.
- October 16th is the deadline to file your tax return if you filed an for an extension prior to the April 18th deadline
Second – Look for tax credits
Tax credits often work better than deduction to reduce your tax liability and could increase your refund. If you get a dollar as a tax credit, you get a dollar off your taxes which is an ideal situation. Tax credits exist for a variety of reasons like child and dependent care, paying for college, and even making energy efficient updates to your home.
Third – Don’t overlook your retirement savings!
Even though we are now in 2023, you have until April 15th to make an IRA contribution and have it count toward the 2022 contribution limit. Doing this benefits you in two ways.
First, you can use up any remaining 2022 contribution limit, so you can take full advantage of the 2023 contribution limits as well.
Second, traditional IRA contributions may be deductible and save you money on your tax bill. Limitations may occur depending on your income and how you file your taxes. Be sure to consult with a tax advisor to determine if you can take advantage of this opportunity to reduce taxes and boost your retirement savings.
Remember, everyone has an opportunity to make a positive impact on their financial life with simple actions and consistency. Conversations about money are normal and our team is here to help. We invite you to schedule a coaching session with a financial coach to ask questions and develop a plan to achieve your goals. We also have a ton of tools and resources to help you at your own pace.