Does tax season fill you with a sense of dread? If you spend every April waiting for that surprise bill in the mail, you’re not alone. Navigating tax season is stressful—filled with complex calculations and technical jargon that seems impossible to understand. This episode of “Real Personal Finance” aims to take the anxiety out of taxes and help listeners create a strategic plan for next season. Scott Frank, founder of Stone Steps Financial, is joined by Meg Bartelt, founder of Flow Financial Planning, LLC, to welcome back the podcast and answer the question: How can you avoid surprises during tax season?
Tax projections provide a map of how much you owe throughout the year. Rather than being blindsided by a hefty bill come tax time, regularly monitoring your owed taxes can help keep your payments on track. Scott and Meg talk about the importance of adopting a proactive mindset regarding your tax planning. If you can tackle the challenge beforehand, it allows you more time to formulate a plan.
Are you giving enough through the year to offset the payment during tax season? Meg suggests that if you are withholding less than 22%, you may be setting yourself up for a difficult tax season. Opting for higher withholding rates helps offset the payment in April. Scott and Meg share ways to make the most of your retirement savings and how to handle estimated tax payments, especially after big financial changes in your life. A key topic is how to correctly report the cost of RSU shares when you sell them, which helps you avoid being taxed twice—a risk many investors may not know about.
Partnering with a tax professional is the key to avoiding surprises during tax season. Not only can they help you figure out what you owe, but they can also help you navigate actually paying. An important detail to remember is that while you can file an extension on your tax return, your payment is still due on April 15th—unless you want to be penalized. A tax professional is there to ensure that when Tax Day comes, you’re not scrambling to find the cash.
This week’s episode aims to conquer your fear of tax season. Taxes don't seem as daunting when you take steps to plan ahead. Instead of stresses over the details, consult with a tax professional to create a plan that serves you. Don’t let the fear of a surprise bill stop you—the sooner you create a plan, the sooner you can get back to enjoying life.
Key Takeaways:
Stay on Top of Tax Projections: Regularly monitoring your owed taxes throughout the year can help you avoid a large, unexpected bill when tax season rolls around.
Adjust Withholding Rates: If you're withholding less than 22% of your income, consider increasing it to avoid a tough tax season. Higher withholding rates can ease the burden come April.
Manage RSU Shares Carefully: Correctly reporting the cost of your RSU shares when you sell them helps you avoid double taxation—many investors might not be aware of this risk
Partner with a Tax Professional: A tax expert can help you navigate your tax obligations, ensuring you're prepared and avoiding last-minute stress. Remember, while you can file an extension on your return, your payment is still due on April 15th.
Ready to learn more?
Scott Frank on LinkedIn
Meg Bartelt on LinkedIn
Stone Steps Financial
Money can be confusing—but it doesn’t have to be. When you’re able to understand the complexities, you can make better decisions to improve your daily life. Are you ready to align your money with your ideal life? Connect with us at Stone Steps Financial.
Комментарии