The Professional Expert

Taxes - Getting the paperwork together

Disclaimer: This is entry not intended to offer official tax advice. Please see www.irs.gov or contact a certified tax professional with any questions or for specific instructions.  

The first thing to do is get all of your paperwork in order.  The main things are your W2 and 1099 forms.  These will start arriving in the mail in January.  These show income you had during the year.  They also show how much tax was withheld (tax you have already paid).

The W2 form comes from your employer. This form shows how much income you earned for the past year as well as how much you paid in federal, state, and local taxes. It also shows the Social Security and Medicare taxes you paid last year.

1099 forms are sent out by banks and investment accounts.  These will reflect your income or losses due to your savings and investments.

1099 forms also cover a variety of other income, such as contract work you got paid for, but were not considered an employee. 

You may also want to gather paperwork for deductions. If the total of your mortgage interest, medical expenses you paid, and donations to charity are more than $5,300 if you are single or $10,700 if you are married filing jointly, you can itemize these deductions to get more than the standard deduction. If the total is not higher, you can still take the standard deduction.

Paperwork to get together for deductions:

Mortgage interest statements – these tell you how much interest you paid on your mortgage last year. The interest is deductible.

Medical expenses that you have paid – if you paid out-of-pocket large medical bills last year, these may be deductible. This deduction only covers the amount you paid, not the insurance company. For more info visit www.irs.gov/taxtopics/tc502.html

Donation receipts for charitable organizations – visit www.irs.gov/pub/irs-pdf/p526.pdf to find out the guidelines on charitable donations.

Now that you have your paperwork in order, tomorrow we’ll discuss how to “do your taxes?”

No Comments yet »

RSS feed for comments on this post. TrackBack URI

Leave a comment