The Best Time to Prepare for Tax Season is Now

As we approach year-end, taking a few minutes to get a handle on the details that impact your tax preparation will pay dividends down the road. Preparing for tax season now can reveal planning opportunities to reduce your tax liability and help you establish an organized system for managing the inevitable flood of documents arriving in January. Here are a few practical steps to set yourself up for a smooth tax season. 

1. Start Preparing for Tax Season by Getting Organized 

Before anything else, create designated spaces—both physical and digital—to collect all documents that will affect your taxes. 

Set Up a Physical Collection Point 

Choose one location for all hard-copy documents. Perhaps a tray in your home office, a wicker box by your front door, or even a large envelope in your mudroom—any place that’s convenient and close to where you usually sort your mail. Make sure to use only one location, so you don’t have to track down forms in an assortment of drawers, files, and piles. 

Do the Same for Electronic Documents 

Pick a secure, central digital folder—ideally one that can be shared with members of your household. This makes it easy for everyone to upload documents as they arrive. 

If your tax preparer uses an app, such as TaxCaddy, you can upload forms throughout the year, reducing the burden during tax season. 

Use bank and credit card statements to identify deductible expenses and review activity from throughout the year. W-2s, 1099s, and other tax forms will start arriving in January, and knowing exactly where to store them helps you stay on top of it all. 

Create a Checklist 

If you don’t already have a tax document checklist, now is the perfect time to create one. 

A simple place to start: 

• Review last year’s tax return 
• Note the documents you needed 
• Add anything new for 2025 that your preparer should know about 

Also be sure to document all estimated federal, state, and local tax payments made for 2025 so your preparer has the full picture. 

2. Review Your Spending for Missed Opportunities

A year-end review of bank and credit card statements can also help you ensure you have met your annual goals for items such as charitable giving and IRA, HSA and 529 contributions. If not, there is still time to contribute prior to year’s end.  

If you’re considering additional charitable giving, remember that donations of appreciated stock can be especially efficient. You can avoid paying tax on the embedded gain and receive a deduction for the fair market value. 

3. Summarize Medical Expenses

If you had significant out-of-pocket medical costs, start summarizing them now. Your tax preparer can then determine whether you qualify for the medical expense deduction without scrambling at the last minute. 

4. Consider the Impact of New Tax Law Changes

The recently enacted law increases the allowable state and local tax (SALT) itemized deduction to $40,000 for 2025 (if you qualify). If you expect to itemize and haven’t met this threshold, you may be able to maximize deductions by paying real estate taxes or state and local estimated payments before year-end. 

5. Stay on Top of Business Activity (If You’re Self-Employed)

If you’re self-employed or own a business, review your revenue and expenses to ensure everything is recorded accurately. Knowing where you stand and having everything accounted for as you approach year-end provides the opportunity to evaluate planning opportunities such as additional spending and retirement plan contributions. 

6. Scan Documents Ahead of Time

If you have a large volume of paper records, consider scanning them now. Having everything digitized and ready to send will save you time and frustration when tax season arrives. 

A Little Preparation Goes a Long Way 

Organizing now means less stress later. You’ll feel more prepared, more in control, and better positioned to make smart year-end tax decisions.  

You can take this organization to the next level by partnering with a tax preparer who works closely with your financial advisor. At Truepoint, our tax preparers are an integral part of a larger team of experienced financial professionals, who collaborate to develop a bespoke and holistic strategy—including long-term tax planning—for our clients.