Figuring out where to start and what to do while preparing to file your taxes is never an easy task. Who knew something so simple could blow up into a week long hassle driving the stress through the roof.
Getting your act together does not have to be nearly as frustrating as it all too often turns out to be. By staying on top of things throughout the year, you can make it as simple as picking up the file, filing, and if due, receiving your refund check. Wouldn’t that be nice? Even if you weren’t organized all year, you could simply gather, enter, and collect.
Common Filing Needs
The greatest question buzzing around during tax season is what you will need to file with the least amount of disorder. The answer can be simple, but the truth is simple may not get you the most back. Here are some things that you can have prepared which will make sure you get the best results out of filing your taxes.view more tips here!
1) Earning Documentation
Whether you work from home, an office, or for a large corporation you are the one responsible for making sure that you receive documentation of your earnings. While the law does set strict rules that all documents must be postmarked before January 31st, it will be you that has to face the hassle of not receiving it. The most common documentation when getting your taxes done include:
• W2 – This will be given by employer to show earnings, withholdings, and other necessary details of your case.
• 1099 Forms – If you are a private contractor, investor, or business owner you will more than likely need a 1099 form of some type. If you are a private contractor, you should receive a form from everyone that you conducted business with if your total earnings for the entire year were greater than $600. Although some people work under the table, this is actually illegal, and there are tremendous penalties if caught.
2) Spending Documentation
A lot of people underestimate the value of their spending habits when filing their taxes. You can deduct a great number of things that most typically spend their money on. Possible examples are:
• Charity Donations – Take your charity or donation receipts with you when you’re filing. Make sure that everything is accurate and 100% verifiable in the case of an audit.
• Property Tax Records –
• Business Expenses –
• Interest Paid –
• Automobile Registration Fees –
3) Investing Documentation
Although some do not realize it, investment information is very important to keep a hold of and should be used when you file your taxes. Certain and most investments must be claimed as income and will drastically change the entire outcome of your filing. An often misconception is that the government already knows what you have invested because it is public record, but this is not true when speaking of the IRS. With millions of taxes being done at the same time, they don’t necessarily know anything about anyone’s financial situation unless something is red-flagged.see post at https://www.komando.com/tips/342886/protect-your-privacy-when-filing-taxes-online
• A copy of all stock transactions.
• Spreadsheets of investments through the year.
• Organize Sheet to show investments, earnings, and outcome for every penny you invested. This will keep confusion at bay while stress is running high.
• Margin interest paid.
4) Other Documentation:
• If you are going to be filing in an office, there is probably going to be a bit of identification required such as your drivers’ license, and some have even gone as far as a birth certificate for first-time customers. Remember that this is done to keep you safe, and you wouldn’t want anyone to have easy access to your documents.
• Social Security Numbers of everyone in the home will be a must along with their date of birth.
If you are wondering where you can get the recommended information that the IRS will be asking to see in the case of an audit, please go to the National Treasury Department Website where they have detailed information regarding almost every financial situation and exceptions that have occurred throughout the year.