We still have several months before our taxes are due on April 15th. Therefore, we still have plenty of time to start working on our income tax returns. Following this tax preparation checklist will help you get ready for this year’s return, ensuring you don’t miss any document or information. This includes having all your personal information ready, having all income records in order, and also having all expense records together. This will ensure your income tax returns get processed in a timely manner.
Personal Information
As surprising as it may sound, there are many taxpayers who do not know their Social Security Number, and that might not even know they need it to file a tax return. For others, this number is so common, it is easy to forget about adding it. Also, it is important to have the SSN of your spouse and any children or dependents, too. This will ensure your returns have all the personal information needed.
Income Records
Another piece of essential information we simply cannot forget as part of this tax preparation checklist is our income information. We need to let the IRS know how much we earned during 2019, including income from our main employer, a temporary job, a side job, or any investments we might have made.
There are two forms we must include in our income tax returns, the W-2, and the 1099. Form W-2 is the one that your employer will give you. 1099 Form is for anyone who might have worked on a freelance basis, making $600 or more. In addition, we will need a record of any other income we might have received during the year coming from:
- Social Security Income if applicable,
- Investment Property Income
- Alimony Payments
- Debt Cancellations
- Jury Duty Income
- Gaming Winnings
- Virtual Currency Payments
Expense Records
Lastly, we also need to provide the IRS with complete and accurate expense records, since there are many deductions and credits we might qualify for. In order to claim such deductions or credits, we need to show the IRS proof of such expenses. Some of the most common deductions include mortgage interests, property taxes, charitable contributions, and medical expenses. These are some other deductions you might be eligible for:
- Student Loan Interests
- Higher Education Expenses
- Child Care Costs
- Educator Expenses
- IRA Contributions
- HSA Contributions
- Business Expenses such as equipment, supplies, travel, and home office.
In order to make sure you file your income tax returns properly, accurately, and in a timely manner, work with the best tax advisor. Besides, following this tax preparation checklist, you will be able to claim every eligible deduction and receive a tax refund in no time.
