Whether you plan to stay up to greet the new year or go to bed early, as a taxpayer you can get ready for 2023 by reviewing these common end-of-year tasks. People can always visit IRS’ Get Ready webpage for info on filing their tax return. Here are a few things to keep on their radar, according to a news release.
Check Individual Taxpayer Identification Number
The IRS issues ITINs to people who are required to have a U.S. taxpayer identification number but don’t have one and are not eligible to obtain, a Social Security number. If I was not included on a federal tax return at least once for tax years 2019, 2020, and 2021, the ITIN will expire on Dec. 31, 2022.
Individuals only need to renew an ITIN if it has expired and is required on a federal tax return.
Find Information About Retirement Plans
IRS.gov has end-of-year tax information about retirement plans. This includes resources for individuals about retirement planning, contributions, and withdrawals.
Contribute Salary Deferral
Taxpayers can make a salary deferral to a retirement plan. This helps maximize the tax credit available for eligible contributions. Taxpayers should make sure their total salary deferral contributions do not exceed the $20,500 limit for 2022.
Donate to Charity
Taxpayers must make any donation to a tax-exempt organization they want to deduct on their 2022 return by Dec. 31. Most charitable cash donations qualify for the deduction. However, there are some exceptions. Cash contributions include those made by check, credit card, or debit card as well as unreimbursed out-of-pocket expenses in connection with volunteer services to a qualifying charitable organization.
IRA owners age 70½ or over have the option to transfer up to $100,000 to charity tax-free each year. These transfers, known as qualified charitable distributions or QCDs, offer eligible older Americans a great way to give to charity before the end of the year. For those who are at least 72, QCDs count toward the IRA owner’s required minimum distribution for the year.
Get Banked and Set Up Direct Deposit
A direct deposit gives taxpayers access to their refund faster than a paper check. Those without a bank account can learn how to open an account at an FDIC-insured bank or through the National Credit Union Locator Tool. Veterans should see the Veterans Benefits Banking Program for access to financial services at participating banks.
Connect with the IRS
Taxpayers can use social media to get the latest tax and filing tips from the IRS. The IRS shares information on things like tax changes, scam alerts, initiatives, tax products, and taxpayer services. These social media tools are available in different languages, including English, Spanish, and American Sign Language.
Think about Tax Refunds
The fastest way taxpayers can get a tax refund is by filing electronically and choosing direct deposit, but no one should ever plan to get a refund by a specific date. This is especially true for those who want to use their refund to make major purchases or pay bills.
Source: IRS