Now is a Good Time to Plan for Next Year's Taxes

You may be tempted to forget about your taxes once you've filed, but doing some early tax planning now may benefit you later. Now is a good time to set up a system that will keep your tax records secure and easy to find. Here are some tips from the Internal Revenue Service (IRS) that will make next year's taxes a breeze:

• Take action when life changes occur: Some life events can change the amount of taxes you owe. Examples include a change in marital status or the birth of a child. When these happen, you may need to change the amount of tax withheld from your pay. To do that, file a new Form W-4 (Employee's Withholding Allowance Certificate) with your employer. Use the IRS Withholding Calculator to help you fill out the form.
• Report changes in circumstances to the Health Insurance Marketplace: If you enrolled in insurance coverage through the Health Insurance Marketplace for 2016 coverage, you should report changes in circumstances to the Marketplace when they happen. Report events such as changes in your income or family size. Doing so will help ensure that you receive adequate financial assistance.
• Keep records safe: Print and store a copy of your 2015 tax return and supporting records together in a safe place. This includes W-2 Forms, Forms 1099, bank records and records of your family's health care insurance coverage. If you ever need your tax return or records, it will be easier for you to access them. For example, you may need a copy of your tax return if you apply for a home loan or financial aid for college. You should also use your tax return as a guide for processing your taxes next year.
• Stay organized; make tax time easier: Designate a location, such as a file or drawer, for important financial documents, where you and your family can add tax records as they become available throughout the year. That way, you won't have to search for misplaced records when you file next year.
• Consider itemizing: You may be able to lower your taxes if you itemize deductions instead of taking the standard deduction. Owning a home, paying medical expenses and qualified donations to charity could mean more tax savings. See the instructions for Schedule A (Itemized Deductions) for a list of applicable deductions.
• Stay informed: Review each of the newsletters you receive from Sanders Thaler Viola & Katz, which includes notifications of changes to tax laws, tips on saving money and much more. You can also subscribe to the IRS Tax Tips emails through IRS.gov or download the IRS2Go mobile app, which send out tips each weekday in the tax filing season and three days a week in summer. You will also receive "Special Edition Tax Tips" at other times during the year.

To learn more about Sanders Thaler Viola & Katz, LLP,
visit www.st-cpas.com.