Don’t Wait Until Tax Season: 8 Tax Planning Moves to Make This August

August is a good time to review your tax situation. This year, there is another reason to do it now.The September 15 estimated tax payment deadline is approaching.If you are self-employed or earn income from investments, rental properties or other sources where taxes are not automatically withheld, now is the time to check whether your estimated payments are on track.A review in August also leaves enough time to make other adjustments before year-end.

Here are eight areas worth reviewing.

1.  Review Your Income so Far

Start with your year-to-date income.Has your income increased? Did you start a business, change jobs, sell investments or receive rental income?Knowing where you stand today makes it easier to estimate your full-year tax liability.

2. Check Your September 15 Estimated Tax Payment

This deserves particular attention in August.If you are self-employed or receive significant non-wage income, review how much you have already paid in estimated taxes and whether your September 15 payment needs adjustment.Investment gains, rental income, freelance work and business profits can all change what you may owe.

Tip: Do not simply repeat the amount you paid last quarter if your income has changed.

3.  Review Your Tax Withholding

For salaried taxpayers, check whether enough tax is being withheld from each paycheck.A raise, bonus, second job or change in your household finances could mean your current withholding is no longer appropriate.There is still time to adjust your Form W-4 before year-end.

4. Review Your Retirement Contributions

Check whether you are making the most of the retirement contribution opportunities available to you.Depending on your situation, increasing contributions could support your long-term financial goals while also providing tax advantages.

5. Review Capital Gains and Losses

Sold stocks, funds or other investments this year?Review your realised gains and losses before December. Waiting until tax season means the opportunity to make certain year-end investment decisions may already have passed.

6. Keep Track of Potential Deductions

Charitable contributions, eligible business expenses and other deductible expenses are easier to deal with when records are maintained throughout the year.August is a good time to organise what you already have and identify anything that is missing.

7. Account for Major Life Changes

Marriage, divorce, a new child, buying a home, relocating or starting a business can all affect your tax situation.Tell your CPA about these changes before year-end rather than waiting until your return is being prepared.

8. Review Schedule a tax Planning Review

A tax planning conversation in August gives you something tax season cannot: time to act.You can review estimated payments, withholding, investments, retirement contributions and other year-end decisions while there are still several months available to make changes.

Final Thought

For many taxpayers, August is much more than the middle of the tax year.

With the September 15 estimated tax deadline approaching, it is an important checkpoint, particularly for business owners, self-employed professionals, investors and rental property owners.

Review where you stand now. Make adjustments where necessary. Then use the remaining months of the year to plan ahead.