Personal finance

Q&A Pro Series: 5 Reasons to Start 2023 Tax Preparation Now

You might not want to consider getting a head start on the 2023 tax season. But tax experts claim that tax preparation takes a whole year.

You’ll want to be sure you acquire paperwork sooner rather than later for life’s circumstances such as becoming a new parent, buying your first property, and selling your home.

You sold your house and made a ton of money.

According to CPA and TurboTax specialist Lisa Greene-Lewis, “I know people earned some large gains on the selling of their homes this year. You should find any receipts for house renovations you made because doing so will allow you to pay less in taxes and benefit.

In order to get a jump start on your 2023 taxes by the end of the year, Greene-Lewis describes tax deductions, credits, and other things you can do now.

You need a social security number if you just had a baby.

Tracy Byrnes: Lisa Greene-Lewis, a CPA and TurboTax expert, is present at this time. And notice how much longer it takes the government offices to complete tasks. Therefore, you sort of have to get going if you need to make improvements. And the only other thing is attempting to obtain a Social Security number, particularly if you are the parent of a newborn.

Lisa Greene-Lewis (LGL) Yes, you should definitely do that since your child qualifies for numerous tax breaks and credits. However, in order to claim such credits and deductions during tax season, you must have their Social Security number.

Byrnes, Tracy You actually make a really good argument and say the same thing about a family member you’ve been taking care of. I never even considered that.

You need a dependent’s social security since you are caring for them.

Lisa Greene-Lewis (LGL) Yes, the relative is the same. Even if you are paying their medical bills, you might be eligible to claim those deductions as well if you are responsible for more than half of their support. In addition, you must their Social Security number.

Concerning knowing these tax laws, don’t worry. With TurboTax, you are covered. You can visit TurboTax and completely hand over your taxes to a TurboTax Live tax professional, who will complete your taxes from beginning to end. When you begin using TurboTax Live, you can save an additional $20.

Your name was changed after your recent marriage.
Byrnes, Tracy Go ahead and find it, then. Finally, in terms of Social Security numbers, if you recently got married or want to get married and change your name, you need to act quickly.

Lisa Greene-Lewis (LGL) Yes, a lot of people are unaware that the IRS and the Social Security Administration exchange information. Therefore, you must update all of your information once you get married. In order to avoid delays when filing your taxes and the IRS verifies the information, be sure the Social Security Administration has your last name on file.

You purchased, sold, or renovated your house.

Byrnes, Tracy It’s crucial to move as soon as you can, even while opening joint accounts and other such things. Additionally, there was a significant amount of home purchasing and selling this year. Therefore, it would seem that people would also need to maintain track of those records.

Lisa Greene-Lewis (LGL) Yes, I am aware that many people this year enjoyed sizable gains from the selling of their properties. You should thus look up your receipts for any house modifications you performed so that you can reduce the amount of taxes and gain that you have to pay. Therefore, when you collect those costs, you can include them in the price of your home and lower the gain that you must pay. And if you’re single, the IRS allows you to exclude up to $250,000 in gain, and if you’re married and filing jointly, you can exclude up to $500,000 in gain.

Right, so if you installed a new roof or renovated your home, among other things, that all raises your cost base and lowers your capital gain. Tracy Byrnes On the other hand, if you purchased a home, you would advise saving the original documents, origination costs, and such items. All of those will eventually be deductible.

Lisa Greene-Lewis (LGL) You should have your closing statements, so put them with the other tax documents you’re gathering. This is because closing statements occasionally include loan origination fees or other fees that may be tax deductible but do not appear on other forms, such as the Form 1098 that shows your mortgage interest. You should therefore have everything in order.

Start a shoebox, a file, or scan it into something, Tracy Byrnes says. Start recording all of this information. Thank you so much, Lisa Greene-Lewis, for sharing these wonderful advice with us.

Lisa Greene-Lewis (LGL) I appreciate you having me.

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