The end of the year is fast approaching. Many individuals and small business owners are turning their attention to year-end financial reporting and preparations for next year’s tax season. Wrapping up the year with tax day in mind allows you to make decisions that favorably impact your tax liability.
Mark These on the Calendar
To help keep you on track, here are a few filing dates to remember as you close out the year.
December 31, 2022: 529 and 401(k) Contributions Due
Parents and grandparents often set up 529 accounts when children are born, so there’s money to pay for college when the kids are ready to go. Contributions to a 529 account are tax-deductible at the state level. Unlike other investment options, there is no limit to how much you can contribute. The catch is that all 529 contributions for 2022 have to be made by December 31.
December 31 is also the date by which contributions to your employer-sponsored 401(k) plan are due. Typically, no one misses this date since contributions come from employees’ paychecks. A 401(k) is a great way to save for retirement, and many employers match employees’ contributions up to a certain amount each year. It makes sense to take advantage of this “free” money. It’s also wise to contribute as much as possible because it reduces your taxable income.
January 16, 2023: Q4 Estimated Tax Payment Due
If you’re a small business owner or independent contractor and have to make estimated tax payments throughout the year, you’ll want to mark this date on the calendar. Your fourth quarter estimated tax payment for 2022 is due on January 16, 2023.
January 31, 2023: W-2s and 1099s Due
The IRS requires employers to send W-2s no later than January 31 to give employees plenty of time to prepare and file their taxes by the April 18 due date.
January 31 is also the date by which 1099s should be mailed to independent contractors, self-employed workers, and others who’ve earned $600 or more through work you’ve provided. In addition, 1099s should be sent (or received) for income generated through non-work-related means, including dividends, interest, prize winnings, rent, royalties, etc.
April 18, 2023: 2022 Taxes and IRA/HSA Contributions Due
April 18, 2023, is tax day. That’s not a typo. Since April 15 falls on Saturday, the IRS pushed tax day to Tuesday, April 18. Thank your lucky stars for three extra days to prepare!
Tax returns for 2022 have to be mailed no later than April 18, 2023. Even if you don’t have the money to pay the taxes you owe, the IRS still expects to receive a tax return. If you don’t meet the deadline, you’ll be subject to penalties and interest, so even if you don’t send a check, send in the return!
If you need to make payment arrangements, contact the IRS to work out a plan.
If you’re not ready to file your tax return, you can file an extension, also due by April 18. This gives you until October 15 to file your return. Remember that even if you file an extension, the IRS expects you to send in the taxes you owe by April 18. The extension applies to the tax return, not the taxes owed.
Finally, April 18 is the last day you can make contributions to your IRA or HSA accounts and have them count for the 2022 tax year. At Adams Accounting Solutions, we recommend making final contributions to these investment accounts by December 15. That way, there’s no mix-up later over the year to which they apply.
Have Questions?
At Adams Accounting Solutions, part of our job is to stay on top of due dates for our clients. We’ll remind you when deadlines are coming up and do our best to get your tax-related forms filed on time. If you’re looking for an accounting firm that has your best interests at heart, give us a call. We’re happy to sit down with you and discuss your specific tax situation!
