Mid-Year Tax Checkup: 6 Things to Do Before December
We're halfway through the tax year — a good time to take stock before things get busy at the end of the year. The IRS recommends a simple mid-year check to make sure you're not heading into filing season with surprises. Here's what to look at now.
1. Keep Your Tax Records in Order
Don't wait until April to hunt for receipts and documents. Keep all important tax records — income statements, expense receipts, donation letters — in one organized place. This could be a labeled folder or a digital tool. The better your records, the less stress at tax time, and the less likely you are to miss a deduction.
2. Check Your Filing Status
Your filing status — Single, Married Filing Jointly, Head of Household, etc. — affects your tax rate, deductions, and eligibility for credits. Life changes like marriage, divorce, the birth of a child, or the death of a spouse can change your correct status. The IRS offers the
Interactive Tax Assistant: What is my filing status? — a free tool to help you find the right one for your situation.
For non-residents and expats: your filing status is determined by your residency status and marital status under U.S. tax law, which may differ from your home country. If you're unsure, this is worth verifying with a tax professional.
3. Understand Your Adjusted Gross Income (AGI)
AGI is your total income from all sources minus specific adjustments (like student loan interest, alimony, or contributions to certain retirement accounts). It matters because your tax rate, eligibility for deductions, and qualification for credits all depend on it. A higher AGI generally means higher taxes — which is why planning to lower your AGI now, before year-end, can make a real difference.
4. Review Your Withholding — Especially With New Tax Law Changes
If you're an employee receiving a W-2 (a U.S. wage statement), your employer withholds federal income tax from each paycheck. If too little is withheld, you'll owe taxes at filing time — and possibly a penalty. Too much, and you've given the IRS an interest-free loan.
This year it's especially important to check your withholding. The
One, Big, Beautiful Bill introduced new deductions that affect how much tax you owe:
- Deduction for tip income
- Deduction for overtime pay
- Deduction for car loan interest
- Enhanced deduction for senior taxpayers (65+)
- Updates to family-related credits, homeownership deductions, and charitable giving
Use the free IRS Tax Withholding Estimator to see if your current withholding is accurate. If it's off, you can submit an updated Form W-4 to your employer.
5. Update Your Address and Name If Needed
Moved recently? Changed your name after marriage or divorce? The IRS needs current information to deliver notices, refunds, and correspondence. To notify the IRS of an address change, file
Form 8822, Change of Address. For a name change, report it to the Social Security Administration first — the IRS cross-checks your name against SSA records.
6. Save for Retirement — It Lowers Your Tax Bill Too
Contributing to a
retirement plan at work (like a 401(k)) or a traditional IRA can reduce your taxable income. These contributions lower your AGI, which can bring you into a lower tax bracket or make you eligible for credits you'd otherwise miss. Mid-year is a good time to check how much you've contributed and whether you're on track to maximize the benefit.
Official IRS Sources
- IRS Tax Withholding Estimator
- ITA: What is my filing status?
- One, Big, Beautiful Bill — Tax Provisions
- Form 8822, Change of Address
- Individual Retirement Arrangements (IRAs)
CPA Tips
Mid-year is the ideal window to make tax moves that are still meaningful. By July, you have roughly 6 months of income data to work with — enough to project your year-end tax liability with reasonable accuracy.
If you're a non-resident or expat with U.S. income: check whether the new deductions under the One, Big, Beautiful Bill apply to your situation. Some of them (like tip and overtime deductions) may not apply if your income is classified differently. A CPA can help you model the impact.
If your income varies (freelance, contract, investments), consider adjusting estimated tax payments rather than relying solely on withholding. Underpaying estimated taxes can trigger a penalty even if you pay in full at filing time.