Before toasting the new year, taxpayers should review this to-do list

December 16, 2022

Whether they plan to stay up to greet the new year or go to bed early, taxpayers can get ready for 2023 by reviewing these common end-of-year tasks. People can always visit IRS’ Get Ready webpage for info on filing their tax return. Here are a few things they should keep on their radar.

Check Individual Taxpayer Identification NumberThe IRS issues ITINs to people who are required to have a U.S. taxpayer identification number but who don’t have, and are not eligible to obtain, a Social Security number. If ITIN was not included on a federal tax return at least once for tax years 2019, 2020 and 2021, the ITIN will expire on December 31, 2022.

Individuals only need to renew an ITIN if it has expired and is needed on a federal tax return.

Find information about retirement has end-of-year tax information about retirement plans. This includes resources for individuals about retirement planning, contributions and withdrawals.

Contribute salary deferralTaxpayers can make a salary deferral to a retirement plan. This helps maximize the tax credit available for eligible contributions. Taxpayers should make sure their total salary deferral contributions do not exceed the $20,500 limit for 2022.

Donate to charityTaxpayers must make any donation to a tax-exempt organization they want to deduct on their 2022 return by December 31. Most charitable cash donations qualify for the deduction. However, there are some exceptions. Cash contributions include those made by check, credit card or debit card as well as unreimbursed out-of-pocket expenses in connection with volunteer services to a qualifying charitable organization.

IRA owners age 70½ or over have the option to transfer up to $100,000 to charity tax-free each year. These transfers, known as qualified charitable distributions or QCDs, offer eligible older Americans a great way to give to charity before the end of the year. For those who are at least 72, QCDs count toward the IRA owner’s required minimum distribution for the year.

Get banked and set up direct depositDirect deposit gives taxpayers access to their refund faster than a paper check. Those without a bank account can learn how to open an account at an FDIC-insured bank or through the National Credit Union Locator Tool. Veterans should see the Veterans Benefits Banking Program for access to financial services at participating banks.

Connect with the IRSTaxpayers can use social media to get the latest tax and filing tips from the IRS. The IRS shares information on things like tax changes, scam alerts, initiatives, tax products and taxpayer services. These social media tools are available in different languages, including English, Spanish and American Sign Language.

Think about tax refundsThe fastest way taxpayers can get a tax refund is by filing electronically and choosing direct deposit, but no one should ever plan to get a refund by a certain date. This is especially true for those who want to use their refund to make major purchases or pay bills.

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Copyright 2023. Penobscot Bay Regional Chamber of Commerce All rights reserved.