Did you get a big tax refund, or get hit with a big tax bill, after filing your 2024 tax return? The Illinois CPA Society suggests taxpayers start thinking about next tax season now.

CHICAGO, April 28, 2025 – Tax Day has come and gone, but that doesn’t mean your taxes shouldn’t stay top of mind. In fact, if you found yourself facing a steep tax bill or receiving an unexpectedly large tax refund, there’s likely some smart money moves to make now to optimize your taxes to keep as much of your money in your pocket before the next filing season. Here are five steps to take.

1. Review your 2024 tax return. The key to understanding why you may have gotten a tax refund or had to pay a tax bill is in your tax return. Maybe you received a one-time bonus that you owed additional taxes on. Or perhaps your promotion or job change that saw you start earning a higher salary also bumped you into a higher tax bracket. Even if your income hasn’t changed dramatically, major life events, like getting married or divorced, having a child, or a dependent aging out of certain tax credits, can affect your tax situation and may warrant an update to your W-4. These small adjustments now can help prevent big surprises next April. Additionally, if you’re one of the millions of Americans with a side hustle that generated 1099 income, it’s important to understand how that income is taxed and plan accordingly. So, take some time to look through your federal and state tax returns to account for what’s changed for you and whether those changes will impact your tax situation for the year ahead or beyond.

    

2. Check your withholdings. If you’re a W-2 employee, adjusting your payroll withholdings on your W-4 is one way of ensuring you’re setting aside just the right amount of taxes from each paycheck. Your ultimate goal is to have little to no taxes refunded or due come Tax Day. In other words, if you owed more taxes than expected, or collected a substantial tax refund, revisiting your payroll withholdings is a must. Some common reasons for needing to update one’s payroll withholdings include starting a new job that causes a notable income shift; changes like marriage, divorce, or becoming a widower that would change your filing status; welcoming a new child or other dependent into your family that may qualify you for tax credits or deductions; or having a dependent child age out of qualifying for certain tax credits. Taxpayers can use the IRS’ free withholding estimator to help determine if making any changes to your W-4 is beneficial or necessary.

    

3. Mind your non-employee income. If you do freelance or contract work, or if you sell items via eBay, Etsy, Venmo, or other digital platforms, you’re likely to receive a 1099 form reporting this income at the end of the year. Be aware that the IRS has been expanding the types of transactions reported via Form 1099-K, especially for users of third-party payment apps, so even casual sellers or hobbyists might receive a form they weren’t expecting. If this non-employee compensation grows to notable levels throughout the year, making estimated tax payments is almost certainly required to avoid a large tax bill due by Tax Day. Also beware, if you’re not paying enough tax throughout the year through either payroll withholdings or estimated tax payments, you may also be subject to an underpayment penalty come tax time.

    

4. Revisit your investments. Do you contribute to a tax-deferred retirement account via payroll deductions? Are you actively trading stocks on a regular basis? Did you inherit a large sum of money that’s now earning substantial interest in a high-yield savings account? Or do you hold mutual funds that pay out capital gain distributions near year-end, sometimes even in tax-deferred accounts like IRAs? Each of these personal finance situations can affect your tax exposure in ways that may not be obvious at first glance. Understanding where your money is held, how it grows, and what type of income it generates is essential to making more tax-efficient investment decisions and avoiding an unexpected tax burden.

    

5. Start planning for 2025 now. Proactive planning isn’t just about avoiding surprises, it’s about positioning yourself to take advantage of tax-saving opportunities throughout the year. Whether it’s increasing retirement contributions, tracking deductible expenses, planning charitable giving, or considering the tax impact of life changes, starting now gives you the most flexibility. The sooner you act, the more control you’ll have when it comes time to file your 2025 return.

Tax planning can be complicated, but it’s critical to your financial success. Whenever you have questions or concerns about your tax situation, know that a CPA—a certified public accountant—can provide clarity. A CPA can help you optimize your tax strategy, make a financial plan, and manage your finances well into the future. ICPAS’ free “Find a CPA” directory can help you find the trusted, strategic advisor that’s right for you based on location, types of services needed, and languages spoken. Find a CPA at www.icpas.org/findacpa.