Get Ready for Taxes: What to Do Before the Tax Year Ends Dec. 31.
WASHINGTON – As tax filing season approaches, the Internal Revenue Service reminds taxpayers there are things they should do now to get ready for filing season.
For most taxpayers, Dec. 31 is the last day to take actions that will impact their 2024 tax returns. For example, charitable contributions are deductible in the year made. Donations charged to a credit card before the end of 2024 count for the 2024 tax year, even if the bill isn’t paid until 2025. Checks to a charity count for 2024 as long as they are mailed by the last day of the year.
Taxpayers who are over age 70 ½ are generally required to receive payments from their individual retirement accounts and workplace retirement plans by the end of 2024.
Most workplace retirement account contributions should be made by the end of the year, but taxpayers can make 2024 IRA contributions until April 15, 2025. For 2024, the limit for a 401(k) is $23.000 ($30,500 if age 50 and older). For traditional and Roth IRAs, the limit is $7,000 ($8,000 if age 50 or older) and up to $16,000 for a Simple IRA ($19,500 for age 50 or older). Check IRS.gov for more information about cost-of-living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2024.
Taxpayers should be careful not to count on getting a refund by a certain date, especially when making major purchases or paying other financial obligations. Taxpayers can take steps now to make sure the IRS can process their return next year.
Taxpayers who have moved should tell the US Postal Service, employers and the IRS. To notify the IRS, mail IRS Form 8822, Change of Address, to the address listed on the form’s instructions. For taxpayers who purchase health insurance through the Health Insurance Marketplace, they should also notify the Marketplace when they move out of the area covered by their current Marketplace plan.
For name changes due to marriage or divorce, notify the Social Security Administration so the new name will match IRS and SSA records. Also notify the SSA if a dependent’s name changed. A mismatch between the name shown on your tax return and the SSA records can cause problems in the processing of a return and may even delay a refund.
Some refunds cannot be issued before mid-February. By law, the IRS cannot issue refunds before mid-February for tax returns that claim the Earned Income Tax Credit or the Additional Child Tax Credit.
Some Individual Taxpayer Identification Numbers must be renewed. Any Individual Taxpayer Identification Number not used on a tax return at least once in the past three years will expire on December 31, 2024. Only taxpayers who need to file a U.S. federal tax return or are claiming a refund in 2024 must renew their expired ITINs. Affected ITIN holders can avoid delays by starting the renewal process now.
Those who fail to renew before filing a return could face a delayed refund and may be ineligible for some important tax credits. More information, including answers to frequently asked questions is available on IRS.gov/ITIN.
This article is shared from IRS.gov Tax Tips