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Tax Preparation Checklist: Lessons from Your 2017 Tax Return


The latest contribution to the CFP Board’s blog offers insights into the lessons we can learn from our 2017 tax return. While we have all our tax forms and documents handy, this is the perfect time to analyze last year’s finances and prepare for the big changes that will occur in the years to come.

By thinking through next steps based on your current financial status, you’ll be able to better stay on top of your finances and clearly understand how the new tax laws will impact you moving forward. If you need guidance during this exercise, enlist the help of your financial planner to help you evaluate the outcome of your 2017 tax filing, use the insights gathered to adequately prepare you for 2018 and understand what the changes to tax laws mean for you.

To get started, here’s a checklist to follow:

Be a Neat Freak: Create a real or electronic file exclusively for your 2018 taxes to store all relevant receipts, statements, W-2s, 1099s, property tax bills and mortgage interest statements throughout the year. Be sure keep track of your purchase price, commission, and sales price for any investment transactions as well.

Be Smart About Your Refund: Use found money from Uncle Sam to contribute to a retirement or college savings plan, to pay down outstanding debt or replenish your emergency fund. However, if your refund is larger than a few thousand dollars, it’s time to adjust your income tax withholdings at work. If you’re self-employed, be sure to lower your quarterly estimated tax payments accordingly.

Be Cautious with Retirement Savings: If your tax bracket is dropping, this year could be an excellent time to convert your traditional IRA into a Roth. Carefully consider the tax consequences of the conversion—it may be worth waiting until the fourth quarter when you know exactly what your 2018 earnings will look like.

Be Mindful of New Tax Laws: The new tax law affects standard deduction limits, as well as deduction limits for medical and dental expenses, and home mortgage interest. This will impact whether you can deduct charitable gifts, when to schedule medical procedures and how you use home equity loans.

Be Proactive About Planning: After tax season, check in with your accountant or financial advisor and ask him or her to create mock 2018 returns. Thinking about your new tax situation can be daunting, but it may be better than you expect. But, if not, it’s better to know ahead of time and be able to put a plan in place.

For more information, check out CFP Board’s

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About the Independent Financial Advisor

Robert Pagliarini, PhD, CFP®, EA has helped clients across the United States manage, grow, and preserve their wealth for the past 25 years. His goal is to provide comprehensive financial, investment, and tax advice in a way that was honest and ethical. In addition, he is a CFP® Board Ambassador, one of only 50 in the country, and a real fiduciary. In his spare time, he writes personal finance books, finance articles for Forbes and develops email and video financial courses to help educate others. With decades of experience as a financial advisor, the media often calls on him for his expertise. Contact Robert today to learn more about his financial planning services.

Reach us at (949) 305-0500