How Can Individuals Prepare for the Start of Tax Season? by Rick D. Bazzani, CPA

Posted on January 16, 2020 by Rick Bazzani

The 2020 tax season officially begins on January 27, when the IRS will begin accepting and processing individuals’ electronically filed tax returns for 2019. With the federal filing deadline on Wednesday, April 15, taxpayers have just two-and-a-half months to gather important documents, meet with their tax advisors and pay any outstanding tax liabilities from 2019. Following are some tips to help make the process a little easier.

Last year’s tax season was the first under the Tax Cuts and Jobs Act (TCJA), which made significant changes to the tax code and the ways in which taxpayers file their returns and calculate their tax liabilities. Provisions contained in the new law, including reduced federal tax rates, a near-doubling of the standard deduction and the elimination or limitation of various deductions, left many taxpayers with tax bills or refunds that differed from prior years. For this year’s filing season, taxpayers may be in for more surprises resulting from new guidance issued by the IRS over the past 12 months. Therefore, the earlier you start planning, the more prepared you will be to meet your tax obligations by the filing deadline. Remember, taxpayers may receive an extension of time to file their returns, but their tax liabilities are still due on April 15.

Gather Documents

 You should have begun receiving important year-end tax forms, such as W-2 wage statements from your employer and 1099s from your bank and investment accounts. Always remember to check the documents for accuracy and report any required changes back to the payor. You will need to wait for a corrected form before you file your returns with the IRS.

To ensure you have all the documentation you will need to file your tax returns this year, consider looking back at the returns you filed last year. It’s not uncommon for taxpayers to forget credits to which they are entitled or taxable financial transactions that occurred early last year. If you are missing any documents, call the payor directly or consider logging in to your financial accounts online, where you may download the forms you need. Remember to always use strong passwords and two-factor authentication, when available, for the highest levels of online security and protection from identity theft.

With the higher standard deduction under the TCJA, most taxpayers will not itemize their deductions for 2019. Therefore, you may not need to spend any time locating receipts for charitable donations and qualifying medical expenses, which only itemizing taxpayers may use to reduce their taxable income. If you do itemize, however, be sure to recognize that many of the deductions you claimed in the past are no longer available to you under tax reform, including fees for legal, tax and financial services; moving expenses; theft and casualty losses incurred outside federal disaster areas; and ordinary and necessary business expenses that are not reimbursed to you by your employer.

As you gather needed documents to file your 2019 tax returns, take a few moments to assess your existing record-keeping system and consider ways in which you may make improvements to minimize tax preparation burdens in the future. For example, save all the tax-related documents and receipts you amass over the year electronically, so that you can review them and upload them to your accountant’s secure portal when requested.

Check your Filing Status and Number of Dependents

Changes in your life circumstances, including marriage, divorce and the death of a spouse, affect your filing status. If you got married in 2019, your filing status may change from single to married filing jointly, married filing separately or head of household, each of which will change the amount of taxes you owe. Similarly, the birth or adoption of a child during a tax year will affect the tax credits and deductions you may be entitled to receive.

Renew Expiring ITINs

If you previously received from the IRS an Individual Taxpayer Identification Number (ITINs) for tax filing purposes, ensure it is current. The agency uses ITINs to identify those taxpayers who are not eligible for Social Security Numbers, including nonresident aliens, resident aliens and their dependents.

If the middle digits of your ITIN are 83, 84, 85 or 86, 87 (e.g. 9NN-83-NNNN) you must renew your ITIN for 2019 using Form W-7, Application for IRS Individual Taxpayer Identification Number, before filing your 2019 tax return. Expired or inactive ITINs will delay the processing of your tax return, including any potential refunds you may be entitled to receive.

Meet with your Tax Advisor

Over the past year, the IRS has issued a steady stream of guidance clarifying many of the TCJA’s provisions, which has resulted in changes to the original language of the law and the compliance requirements and tax treatment of many types of transactions, business structures and investment vehicles. While it may be too late for you to avoid an unwelcome tax bill this year, meeting with your tax accountant and financial advisors today can help you prepare to meet your tax obligations come April 15.  For example, there is still time for you to contribute to a traditional IRA and receive a tax deduction for 2019. Ongoing planning under the guidance of experiences advisors will also help you maintain compliance with ever-changing tax laws and implement strategies that can reduce your tax liabilities in future years.


About the Author: Rick D. Bazzani, CPA, is a senior manager in the Tax Services practice of Berkowitz Pollack Brant Advisors + CPAs, where he provides individuals and business owners with a broad range of tax-efficient estate-, trust- and gift-planning services.  He can be reached in the CPA firm’s Ft. Lauderdale, Fla., office at (954) 712-7000 or at