Preparing to File Taxes: What Information Do You Need?
Tax filing season is approaching and it’s time to start thinking about gathering all the necessary documents and information for your tax return. Filing taxes is an important annual task that can feel overwhelming if you’re not prepared. So, what information do you need to gather before filing your taxes? Here’s a breakdown of everything you need to know.
Income Information
The first step in filing your taxes is determining your income for the year. This includes all sources of income such as wages, salaries, tips, commissions, and bonuses. You will also need to gather forms related to other sources of income like investment income, rental income, and self-employment income.
W-2s and 1099s
Most employees should receive a W-2 form from their employer, indicating their annual wages and taxes withheld. If you’re self-employed or received income from sources like freelance work, you’ll need a 1099 form from each payer. These forms will report any non-wage income you received.
Expense Records
Along with income, you’ll also need to gather information on your expenses for the year. This includes receipts and records for deductible expenses like charitable contributions, medical expenses, and other itemized deductions. You’ll also need to gather your records for any business expenses, if you’re self-employed.
Retirement Savings
If you contribute to a retirement account like a 401(k) or IRA, you’ll need to gather information on those contributions and their respective earnings. This information will be necessary for calculating your tax bill and can also provide tax benefits.
Social Security Number
Finally, you’ll also need to provide your Social Security number for yourself, your spouse (if filing jointly), and any dependents claimed on your tax return. It’s important to double-check these numbers for accuracy to avoid delays or other issues with your return.
In conclusion, preparing to file your taxes requires gathering all necessary income and expense documents, retirement savings records, and Social Security numbers. It’s important to start the process early and stay organized to avoid any errors or omissions that can lead to penalties or other complications. By following these tips and gathering all necessary information, you can make the tax filing process as smooth and stress-free as possible.
