A new year can bring a lot of excitement – whether it’s setting resolutions, packing up the decorations and cleaning your house, reflecting on a fun holiday, or planning upcoming travel. But a new year also marks the return of a very important task – tax season! While the ultimate April filing deadline may seem far away now, it’s important to keep track of action items and other key deadlines. I spoke with a client about a few reminders this week that I thought were worth sharing here. Let’s dive in.

Q4 2024 Estimated Tax Payments

Perhaps the most important reminder is that final estimated payments for 2024 are due of January 15, 2025. Be sure that you remit your final estimates by that date. Keep in mind you can pay any remaining balance due (above and beyond your safe harbor estimates) upon filing but to avoid penalties and interest, ensure all safe harbor estimated payments are made by the 15th.

Business Owner Reminders

If you own a business, you will want to start pulling together your 2024 financials and supporting documentation. In addition, you may need to file 1099s by January 31, 2025. This will apply if you have paid over $600 to certain parities including individuals who performed services that are not an employee, payments to attorneys, rent payments, interest payments, and several others. If you aren’t certain the rules apply to you, please reach out to your tax advisor.

1099s

As an individual tax payer, you will be on the receiving end of 1099s – tax forms issued that provide support of various items such as interest earned, dividends earned, capital gains, and mortgage interest paid. Delivery dates will vary based on the exact 1099 form but expect to receive them mostly between January and early March. Keep track of these as they arrive and keep a list so you don’t miss one!

Other Tax Information

Most tax advisory firms utilize a tax organizer (paper or electronic) to learn about your situation in the given tax year and identify any changes. While it can seem like a chore, it is very valuable to go thru these documents as you may not realize certain life events impact your taxes. They’ll also notify you what supporting documentation is necessary. Start a folder of documents now so that as forms are received, you have a place for them!

Retirement Account & Health Savings Account Contributions

Certain retirement accounts (like IRAs and Roth IRAs and small business retirement accounts), as well as Health Savings Accounts, allow for contributions to be made up until tax filing (and some allow up until extension dates). Be sure to confirm your eligibility for contributions and the amounts you can contribute for tax year 2024 before making them – but you can start to plan for that required cash flow so you are ready once the amounts are known.

2025 Planning

I know it’s exhausting to even think about 2025 tax season when you’re busy gathering information for 2024. But the clock has already started on 2025 – so it you pay estimated payments, start planning for what that requirement is likely to be this year. The first of those payments will be due in April (at the same time your final 2024 balance is due) so now is the time to adjust cash flow accordingly.

Hope these reminders are helpful. As always, we suggest working with a trusted tax advisor on this important task given the ongoing complexity of the process!