How to Prepare for Next Year’s Taxes Starting Today
Tax season might feel far away, but the smartest way to avoid stress—and potentially save money—is to start preparing now. Here’s how to get a head start on next year’s return
1. 🧾 Organize Your Tax Documents Early
Create a folder (physical or digital) labeled “2025 Taxes” and start collecting:
Pay stubs
Bank interest forms (1099-INT)
Investment summaries (1099-B, 1099-DIV)
Charitable donation receipts
Business or freelance income records
Trust us—future you will be grateful!
2. 💸 Adjust Your Withholding (If Needed)
Use the IRS Tax Withholding Estimator to make sure you’re not over- or underpaying throughout the year. A small tweak now could help avoid surprises next April.
3. 📈 Track Deductions and Credits Year-Round
Stay on top of potential tax breaks like:
Charitable donations
Education expenses
Energy-efficient home upgrades
Retirement contributions (401(k), IRA, HSA)
4. 💼 Keep Business & Side Hustle Records
If you freelance or have a side gig, keep detailed records of income and expenses. Apps like QuickBooks or simple spreadsheets can make a huge difference at tax time.
5. 🧮 Contribute to Tax-Advantaged Accounts
Regularly fund accounts like:
401(k) or Traditional IRA (lowers taxable income)
Roth IRA (tax-free withdrawals later)
HSA (if you have a high-deductible health plan)
These accounts offer serious tax perks!
✅ Pro Tip: Set a recurring calendar reminder each month to check in on your finances and file any receipts or paperwork. A little monthly effort goes a long way.