Tax day might only come once per year, but the financial decisions you make all year round can have significant impacts on your tax burden or tax return. At the end of the year in particular, there are steps that you can take to reduce what you owe.
Keep reading to learn about end-of-year tax tips for businesses and individuals from a Weslaco certified public accountant.
End-of-Year Tax Tips for Businesses
As a business owner, the fact that your tax burden can have a huge effect on your overall business success shouldn’t be news to you. Managing your taxes is a crucial part of running a successful business, and that’s especially true for end-of-year tax preparations. At the end of the year, consider following the tips below to minimize what you owe:
- Complete large end-of-year investments.
- File year-end tax forms.
- Check that your last-quarter financials are caught up.
- Defer income to save on taxes for this year.
- Give to charity to bring down your tax burden.
- Identify unusable inventory for deductions.
- Check on retirement plans.
- Complete any needed office repairs or updates to be deducted.
- Identify uncollectible debts for deductions.
Keep in mind that not every tip will apply or be the best choice for every business. To learn more about the steps you should be taking to prepare for the year ahead, reach out to a qualified Weslaco CPA.
End-of-Year Tax Tips for Individual Filers
As an employed individual filer, you might think that there’s nothing you can do to increase your tax return when tax day comes. Self-employed filers, on the other hand, know that there are plenty of steps they can take to minimize their burden. Whether you’re employed by someone else or work for yourself, you can follow the tips below to maximize what you’re owed.
- Use up your flexible spending account funds.
- Verify that the correct amount has been withheld from your paychecks.
- Max out your contributions to health savings and retirement accounts for deduction.
- Tax-loss harvest by selling investments at a loss to reduce capital gains tax.
- Group your deductible expenses so you can reach the minimum threshold.
- For those 73 and older, collect your minimum distributions from your retirement plan.
For some self-employed filers, it may make sense to also follow some of the tax tips from the section for businesses, but this will vary from person to person. To learn what steps you can take as an individual filer to maximize your return, get in touch with a Weslaco CPA.
Maximize Your Return and Minimize Tax Burdens With Gonzalez & Arrambide
For most of us, tax day is a stressful time full of uncertainty. However, it doesn’t have to be. With help from a Weslaco CPA, you can ensure that your finances are in great shape before the year ends.
If you want to make sure that your tax day 2024 is as painless as possible, reach out to the experienced Weslaco CPAs at Gonzalez & Arrambide, Inc. We can help you get your finances in order and prepare for the year ahead.
Make sure your finances are in line before the end of the year with help from a Weslaco certified public accountant from Gonzalez and Arrambide, Inc.
Individuals working traditional jobs will generally have their taxes withheld automatically by their employers. You should be able to easily find the amount of income tax withheld by inspecting your tax documents.
However, what happens if you do not have an employer? How do you go about paying taxes if you are self-employed?
Just like those traditionally employed, those self-employed do indeed need to pay their taxes. Generally, the individual will be responsible for tracking how much they owe. Because of the challenges this can bring, many choose to work with a personal accountant to help pay their self-employment taxes.
If you are self-employed, here’s what you need to know about paying your taxes in Texas.
Who Has To Pay Self-Employment Taxes?
If you make your income without an employer, you’re probably going to have to pay self-employment tax. Here’s a short list of types of workers where self-employment taxes may apply:
- Independent contractors
- Sole proprietors of a business or trade
- Members of a partnership that carries on a trade or business
- Gig workers
- Part-time business owners
While most employees receive a W-2, contractors and business owners will have a few different forms they will need to properly file their taxes. These can include a 1099-NEC, Form 1040, or 1040-SR.
A tax accountant can help you if you’re unsure where to start.
How Much Is the Self-Employment Tax Rate?
The self-employment tax rate is typically around 15.3%, which is paid into Social Security and Medicare. However, this is higher than what traditional employees pay. That’s because employees pay half of this tax while the employer pays the other half.
To counter this issue, you can deduct 7.65% of your income to pay the employer’s half. This reduces your taxable income, so you pay a bit less in taxes.
What Taxes Do Self-Employed People Pay?
Those who are self-employed pay similar taxes to other traditional employees. Here are the various types you can expect to pay while self-employed:
- Self-employment tax
- Income tax
- Sales tax
- State tax (where applicable)
Income and sales taxes are paid by every working American, while self-employment tax only by those who fall under the category. Most states have a sales tax, but some counties and cities will have their own sales tax on top of that.
How To Calculate Self-Employment Taxes
This can be a bit tricky, so don’t be afraid to contact a personal accountant if you’re overwhelmed or afraid of making a mistake:
- Calculate your net self-employment income by subtracting your expenses from your gross income.
- Find your tax bracket by determining how you will be filing and your income. The rates are different depending on your situation (ex. single filer versus filing jointly)
- Figure out if your net earnings are over $147,000 since you will need to calculate anything above that at a different rate.
- The self-employment tax rate is 15.3% for net income under $142,800. If you make over that, any additional income is taxed at 2.9%.
Trust Gonzalez & Arrambide With Your Self-Employed Taxes
If you’re worried about the IRS coming after you, there’s a simple solution. Trust the professional tax accountants at Gonzalez & Arrambide. We can help you file your self-employment taxes with confidence. Don’t delay, contact us today for your free consultation!
It’s that time of year again! Tax Day is approaching on April 18th and you need to file your taxes before time runs out. Now is the time to get all your ducks in a row to complete your tax preparation or opt for professional help with filing.
The very first thing you need to gather is all your tax-related documents. Which ones you need will depend on your financial situation and employment. For instance, business owners and those who are self-employed will need to gather additional information.
The team at Gonzalez and Arrambide, Inc., wants you to know which documents are necessary for tax preparation.
Proof of Income (W-2, 1099-NEC, etc.)
Most people who are traditionally employed will receive a W-2 form from each job they have. However, self-employed people and business proprietors will need to have their 1040 on hand. If you’re an independent contractor, you should have a 1099-NEC form available.
It’s important to note that there are a variety of 1099 forms that cover the various ways you are obtaining income; from rental income to payouts from a retirement fund, there is likely a 1099 form for that.
If you’re getting your tax preparation done by a Weslaco accountant, bring every form you’ve received. You can also bring any receipts or other records if you’re unsure whether it needs to be reported.
Do you have kids or other dependents? You’ll need to claim them on your taxes, just be sure you have all their information available to you, including: full legal names, dates of birth, and social security numbers. If you share custody of your children, you’ll need to discuss which parent will claim them.
If you own a business or spend a lot on expenses for your job, you’ll be able to claim a number of deductions on your taxes.
Charitable donations, major purchases, and some life events — like paying for college — can also be deducted.
Our experienced tax accountant can help you find additional deductions you may not have even thought of!
Other Tax Documents You May Need
Every individual’s situation is unique, so you may need additional documents to properly complete your taxes.
Businesses can see their taxes change depending on how their year went. If you expanded, the IRS wants to know. Even gambling wins need to be reported! There’s nothing wrong with gathering more documents than you think you need. Critical financial information can come from a variety of sources.
If you want to make sure you remember everything you need, hire a Weslaco accountant to keep your finances on track. As a bonus, it makes Tax Day way easier!
If you’re doing your tax preparation, all you need is your full name and social security number. If you’re getting help with filing taxes, then you will need to provide some information to the preparer.
Your Weslaco accountant at Gonzalez and Arrambide, Inc., may have more requirements, but these are the basics:
- your social security number or Taxpayer Identification Number
- a government-issued photo ID; a passport, state ID, or driver’s license will work
- 2020 and 2021 tax returns if you have them
- your Identity Protection PIN if you were issued one
- ID, social security number, and birth date for your spouse if you are filing jointly
- social security numbers and birth dates for your dependents (children)
Dread Doing Taxes? Let Gonzalez & Arrambide Help!
If you don’t want to deal with the headache of Tax Day, let Gonzalez & Arrambide, Inc., take care of filing your taxes. Our CPAs can help you prepare, file your taxes, and make sure you succeed this tax season.
As a bonus? We can help you year-round with our bookkeeping services! Our CPAs work with individuals and businesses to get ahead of their finances. We help with everything from investments to audits and everything in between. Taking advantage of our bookkeeping services also means you’ll have a leg up next tax season.
Don’t wait, see what we can do for you!
As we move further into the year, important tax deadlines are starting to come up, so it’s crucial that you and/or your business are prepared. If these deadlines are missed, it can result in a number of public or private financial problems, which no one wants to have to deal with.
To avoid any of these issues, your best option for tax preparation is to utilize the help of a licensed tax professional, such as a CPA. Financial experts like tax accountants can help ensure there are no hiccups when an important tax deadline approaches. They can analyze your current finances, help you gather the proper documents, and make sure you stay in the IRS’ good graces.
The tax professionals at Gonzalez & Arrambide are able to help with all of these things and more! When it comes to tax preparation, we have the answers and resources you need.
Read on to learn more about upcoming deadlines or go ahead and reach out to the tax accountants at Gonzalez & Arrambide in the Rio Grande Valley.
Upcoming Tax Deadlines for 2023
Though the first few months of the year have passed, there are still plenty of upcoming tax deadlines to still be aware of and plan for. The following is a basic breakdown of the most important 2023 tax deadline dates:
- April 18th, 2023 – Deadline to File 2022 Tax Returns and Make First Quarter 2023 Estimated Payment
Individuals and businesses must file their 2022 tax returns by this date, unless an extension is granted. This is also individuals’ last opportunity to make contributions to their IRA and/or HSA. Furthermore, individuals who file quarterly will need to make their first estimated payment, which covers January through March of 2023. Tools like our 1040 tax calculator can help!
- June 15th, 2023 – Deadline to Make Second Quarter 2023 Estimated Payment
As mentioned above, individuals who file quarterly will need to make their second payment. This round covers the months of April through May.
- September 15th, 2023 – Deadline to Make Third Quarter 2023 Estimated Payment
Individuals who file quarterly will need to make their third payment. This payment covers the range of June through August.
- October 16th, 2023 – Deadline to File 2022 Tax Returns (With Extension)
For individuals and businesses who needed to file an extension for whatever reason, this is the final deadline to file your 2022 tax returns. We understand that it can get stressful at the end of the year, so plan accordingly if you have to file an extension!
Be Prepared This Year With Help from Gonzalez & Arrambide
As you can see, there are still quite a few tax deadlines to come, which makes it all the more important to get prepared now. Gonzalez & Arrambide can help you ensure that you or your business are ready to file taxes every step of the way this year.
We have tax resources on our website and licensed tax accountants are just a click away!
As IRS deadlines continue to come due throughout the year, it’s crucial that you file your or your business’ taxes correctly and at the right time. Gonzalez & Arrambide has CPAs and other tax accounting professionals who can help make sure you’re prepared this year!
Even though deadlines are still a few months away, the tax season has already begun for many individuals as well as businesses. It can be a stressful time of the year, but filing your taxes is a fact of life that we all need to take care of.
When it comes to individual or business tax preparation, it’s critical to file correctly and punctually.
One of the keys to accomplishing this is to make sure that you have all the necessary documents for yourself, your dependents, or your business when it’s time to file your taxes. With so many different financial records and forms, however, how can you be sure which ones you’ll need?
Gonzalez & Arrambide’s professional team of vCFOs, CPAs, and other financial professionals are here to ensure you know exactly what forms you’ll need to file.
Because everyone’s situation is different, they may require various forms of support. However, here are the most common forms and information you’ll need for a typical person or business.
Which Documents Are Needed to File Your Taxes?
Everyone knows that filing your taxes incorrectly can lead to more problems down the line, which sometimes results in a financial nightmare! One of the best ways to avoid this is to make sure that you have the right documents prepared for when you file.
However, with so many different financial and other important records, it can be hard to know what exactly the IRS needs from you.
We’re here to go over a few of the most common documents you’ll need — but keep in mind that every person, family, or business is different. There may be documents unique to your situation.
Personal Identification Information
While it may seem obvious, there are a few key pieces of information you need for yourself and everyone else who will be on your returns, such as:
- Date of birth, social security/tax ID number, filer’s (including spouse if applicable) driver’s license information
Income and Investment Documentation
This type of documentation has a little bit more to it than your personal information and is often unique to each person or business’ circumstances. Key documents include:
- W2 tax statements, bank statements, stock or other investment documentation, and any type of 1099 Form
Of course, there are several types of 1099 forms, so you need to know which is right for your situation.
For families with children or other dependents, you’ll need to provide the correct dependent information such as social security numbers and dates of birth for all qualifying individuals. You can also report certain expenses like:
- Child/dependent care – necessary to report if you claim the Child or Dependent Care Credit
- Education – full-time students may qualify for some tax breaks
Finally, one of the most important things to remember when you file your taxes is to claim the appropriate deductions as they lower the potential tax payment you’ll have to make. Examples of commonly cited deductions include (but are not limited to):
- Medical bills, donations to charity, educational expenses, mortgage interest, and retirement contributions
Incorrectly filing taxes can cause more issues for you with the IRS. Of course, Gonzalez & Arrambide can help make sure you file correctly, and, if you are already facing an audit, we can assist with that as well.
Gonzalez & Arrambide’s Weslaco Accounting Team Can Answer Any Tax Question!
Though it’s important to have the correct documents available, that’s just one piece of the larger process. Rest assured that the Weslaco accountants, vCFOs, and CPAs at Gonzalez & Arrambide know what the residents of the Rio Grande Valley need to file their tax returns easily and effectively!
Don’t let tax preparation questions bog you down this year – reach out to the Weslaco vCFOs and business accountants at Gonzalez & Arrambide to ask any tax-related questions you may have!