Tax Season: What to Know as the Year Comes to a Close

As we head into the final weeks of the year, it’s a smart time to begin preparing for tax season. While April may feel far away, the decisions you make now can have a significant impact on your tax return, cash flow, and overall financial picture. Early planning helps reduce stress, uncovers opportunities, and allows time to adjust before deadlines arrive.

Why Year-End Tax Planning Matters

Tax season is not just about gathering documents and filing forms. It’s about understanding how the past year’s income, expenses, and life changes come together under current tax laws. Waiting until the first quarter of the new year can limit your options. By starting now, you have time to organize records, make strategic moves, and take advantage of deductions and credits that expire at year-end.

Key Tax Updates to Be Aware Of

This filing season includes several important updates that may affect taxpayers across income levels. Changes introduced through the One, Big, Beautiful Bill bring new or expanded deductions and credits that could significantly impact federal tax returns.

Recent updates include provisions related to:

• Tips and overtime income
• Car loan interest
• Tax considerations for seniors
• Additional credits and deductions affecting individuals and families

These changes may create new opportunities, but they also add complexity. Understanding how they apply to your specific situation is essential to maximizing benefits and avoiding errors.

Steps You Can Take Before December 31

As the year comes to a close, consider taking the following steps to position yourself for a smoother filing season:

Organize your financial documents.
Begin gathering records related to income, charitable contributions, medical expenses, business expenses, and investment activity. Having these documents organized now can save time and reduce the risk of missing deductions later.

Review your withholdings and estimated payments.
A year-end review can help determine whether you are on track or if adjustments are needed to avoid an unexpected balance due or overpayment.

Maximize deductions and credits.
Consider completing charitable donations, retirement contributions, and HSA or FSA spending before December 31. These actions can lower taxable income and improve your overall tax outcome.

Evaluate major life changes.
Marriage, divorce, purchasing or selling a home, starting or growing a business, retirement, or welcoming a new family member can all affect your tax situation. Reviewing these changes now allows for better planning and fewer surprises.

Plan ahead if you own a business.
Business owners should review income timing, expenses, depreciation opportunities, and potential changes that may affect next year’s tax strategy.

Schedule a year-end consultation.
A brief check-in with a tax professional can help identify opportunities, address concerns, and create a clear plan for filing season.

Start the New Year and the Tax Season with Confidence

Tax laws continue to evolve, and staying informed is more important than ever. Proactive planning helps ensure you are not only compliant but also making the most of available opportunities. Taking action now allows you to enter the new year prepared, organized, and confident in your tax strategy.

Our team is here to help you close out the year strong and prepare for a smooth and informed filing season. If you have questions or would like to schedule a consultation, contact us at 706-288-2000 or info@augustacpas.com.