After all the presents have been opened and we have successfully celebrated the beginning of the New Year, the talk of getting tax information gathered and books finalized fills the air in most tax offices. It seems like tax season gets shorter each year, even though there is still about 14 weeks from January 1 to April 15. In the past decade, I’ve become more involved with tax planning for the most proactive clients that reach out with new tax questions/scenarios compared to their previous years. I applaud these clients that reach out before the end of the tax year with questions on how to maximize their deductions or structure their expenses for the best tax circumstances. I ask myself the same question at the beginning of each new tax season: how do I get as many clients as possible to be as proactive as these few?
I’ve put together a list of some of my favorite tax season tips to inspire both individuals and businesses alike to be a little more proactive in 2025 compared to 2024:
Tip 1: Be Prepared – Keep It Simple!
For Everyone: The most important tip is to get your tax documents in order as quickly as possible for tax time. This means utilizing the tax organizers that are sent out in January to keep track of all of the original documents that need to be sent to us. There are government deadlines for when these documents should be either mailed to you or sent electronically, but being on top of this process is key. The sooner that we receive all your tax documentation, generally the sooner we are able to prepare your tax returns.
Pro Tip: Having a designated tax documents folder goes a long way in keeping your tax documents organized. This folder can be physical or digital, but all tax documents should be horded in this folder and this folder only. Checking the tax documents in this folder against your tax organizer is the best way to see what is missing compared to what was submitted the previous year.
Tip 2: The Early Bird Gets The Worm
This one is more specific for owners of small and large businesses alike: Get your books in order as soon as possible after the start of the year. I understand doing paperwork or administrative tasks the week between Christmas and New Years is nowhere near as exciting as seeing family and friends, but your future self will thank you for carving out some time to finalize your books during this time. This will allow us to quickly and efficiently complete your business tax returns, and have them ready, if needed, for your individual tax returns. To get specific, here are the three tasks that, when completed, will put you ahead of most other business owners:
- Categorize all transactions for the year
- Reconcile all bank accounts, credit cards, and loans
- Save and provide copies of year end statements for all these accounts listed above
Pro Tip: Tax Accountants are not sharks – I promise we don’t bite. I say this to make sure that all of our clients know not to be afraid to reach out to us with their tax questions – not just during tax season. I assure you that we would MUCH rather hear from you throughout the year with your tax questions, especially in the middle of summer and right after Thanksgiving.
If any of our business owners are getting annoyed dealing with their books, we would be happy to discuss completing your bookkeeping for you throughout the year. For a competitive monthly price, it would be a win-win: business owners with more time on their hands doing what they enjoy and Tax Accountants with a deeper understanding of their clients’ businesses, able to make better tax and cashflow recommendations throughout the year. Plus, you get to write it off – what more could you ask for?!
Tip 3: Estimating Your Estimates
Contrary to popular belief, Tax Accountants are not wizards – we unfortunately don’t have crystal balls. Even without these magical objects, we are still extraordinary at looking into the future and estimating how much tax our clients might owe from year to year. We have based our clients’ current year estimated tax payments off their previous year tax returns, as there usually isn’t a ton of change from year to year. Unless we are told that something big will happen during the current year that will change a client’s tax circumstances, we stick with the script from the previous year. These big changes might include the following:
- Selling or Buying of Real Estate
- Big Donations started in the current year
- Big Capital Gains or Losses compared to the previous year
- Big changes in Business or Rental income compared to the previous year
Pro Tip: By letting us know ahead of time about any big changes from the previous year, we will be able to provide much more accurate estimates for the current year that take into account any increase or decrease in taxes due.
At the end of the day, our goal is to be as prepared as possible, as soon as possible for all of our clients. This takes some assistance from our wonderful client base, but we truly believe that it’s something to strive for.
To answer my question posed above – I sometimes think putting on a white beard and giving presents to the first 25 clients that reach out to me might be pushing it…but then again, if that’s what it takes for increased client participation earlier in the tax season, I think we might be able to work something out.
Matt Civitello , Deputy Managing Director of Tax Services
Matt joined Baldwin Family Office in 2023 after working in various small and mid-sized tax firms, focusing on High and Ultra High Net Worth clients. He specializes in clients with real estate holdings, constructions companies, unique investment and retirement situations, as well as payroll. Matt graduated from Temple University with a B.S.B.A. in Accounting and is working towards his EA designation. He is a member of the National Association of Tax Professionals.