How to Prepare for Tax Day 2024

January 9, 2024

Most people only think about taxes during preparation season. But for those of us in the tax and accounting business, it’s top-of-mind far beyond March and April. We have not seen major legislation this year, and the IRS is still busy issuing guidance on 2022 tax legislation, which largely impacted green en­ergy investment and retirement planning.

At Wymer Brownlee, we continue to offer all tax clients our communication portal – Liscio. Liscio is an easy, quick and secure mobile app that allows our clients and staff to quickly communicate and exchange sensitive data.

There are some essential items to consider as you begin gathering information for the 2023 tax season. One essential item is our deadline to receive information by March 14 so that we can attempt to complete individual returns by the April 15 deadline.

Prepare for this year’s tax season by quickly reviewing the new areas below for this year’s filing season.

New FinCEN Beneficial Ownership Information Reporting

Anti-money laundering initiative affecting 32 million registered businesses effective 1/1/24. It applies to Corps, LLCs or any other entities created by the filing of a document with the Secretary of State.Established entities (already in business prior to 1/1/24) have until 1/1/25 to file the initial reporting. New companies, established after 1/1/24, will have 90 days to file. Any change in ownership or correction of reporting must be filed within 30 days. The penalties and fines for non-filing are extreme, so please get with your lawyer or tax advisor for more information.

Understand energy related credits

If you bought a vehicle in 2023 should review the changes under the Inflation Reduction Act of 2022 to see if they qualify for the credits for new electric vehicles purchased in 2022 or before or the new clean vehicles purchased in 2023 or after. To claim either credit, taxpayers will need to provide the vehicle’s VIN and file Form 8936, Qualified Plug-in Electric Drive Motor Vehicle Credit, with your tax return.

Last quarterly payment for 2023 is due on Jan. 16, 2024

You may need to consider estimated or additional tax payments due to non-wage income from unemployment, self-employment, annuity income or even digital assets. The Tax Withholding Estimator on IRS.gov can help wage earners determine if there’s a need to consider an additional tax payment to avoid an unexpected tax bill when they file.

Gather 2023 tax documents

Taxpayers should develop a record keeping system − electronic or paper − that keeps important information in one place. This includes year-end income documents like Forms W-2 from employers, Forms 1099 from banks or other payers, Forms 1099-K from third party payment networks, Forms 1099-NEC for nonemployee compensation, Forms 1099-MISC for miscellaneous income or Forms 1099-INT for interest paid, as well as records documenting all digital asset transactions.

All tax information is due by March 14, 2024, so we can attempt to complete your individual return by the April 15 deadline. If we do not receive your data by this date, we can still process your return, but you will be moved to an extension. My best advice is to stay informed, organized and in regular communication with your tax advisor to make the most of your possibilities.

As a reminder, Wymer Brownlee requires a signed engagement letter and updated client data sheet each year before we can begin preparing your return.

Please give us a call or schedule a consultation with one of our team members if you have any questions.

Authored by: Erica Shaloy, Tax Director

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