3 Tax Surprises to Avoid Before April 15

Tax season. Back again, right on schedule. Not anyone’s favorite, but definitely familiar. 

The good news? It doesn’t have to feel quite so tedious or uncertain. With a little clarity and the right guidance, your Paradigm Team can help make the process smoother and hopefully a bit more manageable than you expect.

Preliminary vs Final 1099s

You may receive something called a Preliminary 1099 from your custodian, like Fidelity Investments. This simply means they’re still waiting on final details, often from underlying investments.

While the preliminary version includes most of what’s needed to prepare your return, it’s not the version you want to file with. A Final 1099 will follow, and that’s the one your tax return should be based on. Filing too early can mean needing to amend later…exactly the kind of hassle worth avoiding.

Extensions: What They Do (and Don’t Do)

Filing an extension by April 15 gives you more time to file your return, not more time to pay what you owe. Any taxes due are still expected to be paid by April 15. The extension simply creates breathing room for accuracy, not for delaying payment.

Contribution Deadlines Still Open                                    

You still have until April 15 to make prior-year contributions to IRAs and HSAs. However, your 401(k) contributions must be completed by December 31. The same year-end timing applies to gifting strategies and charitable giving, including donor-advised funds.

It’s a bit of a split calendar. Some opportunities extend into the new year, while others close firmly with December.

For those making estimated tax payments, here’s the rhythm to keep in mind:

• Q1 – April 15
• Q2 – June 15
• Q3 – September 15
• Q4 – January 15 (of the following year)

Whether taxes are paid through paycheck withholding or quarterly estimates, the goal is the same: staying on track so April 15 doesn’t bring any unwelcome surprises.

That’s the key to how we approach tax season at Paradigm.

We’re not just looking backward at what happened. Instead, we’re keeping an eye on what’s unfolding throughout the year. That includes periodic tax estimates to help ensure withholdings and payments stay aligned, so there’s nothing abrupt or unexpected waiting at filing time.

At the end of the day, taxes are rarely about just one day in April. They’re the result of decisions made steadily over time.

Questions about your 1099s, IRA/HSA deadlines, or estimated payments? Reply or schedule time with us here:  Paradigm Complimentary Phone Call