Your Comprehensive Guide to Gathering the Information You Need to File Taxes
As the tax season approaches, it’s crucial to start gathering the necessary information to file taxes. However, the task of gathering this information can be overwhelming for many people. In this comprehensive guide, we’ll take you through the steps to gather all the information you need to file your taxes accurately and on time.
Step 1 – Gather Personal Information
The first step is to gather your personal information such as your full legal name, social security number, and date of birth. You will also need the same information for your spouse and dependent(s) if applicable. It’s important to ensure that this information is accurate and up-to-date before filing your tax return.
Step 2 – Gather Income Information
Next, gather all your income information, including your W-2s and 1099s. If you have additional income sources such as rental income, investment income, or self-employment income, make sure to gather all the necessary information to report it on your tax return.
Step 3 – Gather Deduction Information
To maximize your deductions, it’s essential to gather all the necessary information related to itemized deductions such as charitable contributions, medical expenses, and mortgage interest payments. If you own a small business, make sure to have all the information related to business expenses and deductions.
Step 4 – Gather Identity Verification Information
To prevent tax fraud, the Internal Revenue Service (IRS) requires identity verification information when filing taxes electronically. This information includes your prior-year adjusted gross income, your filing status, and your electronic filing pin.
Step 5 – Gather Health Insurance Information
Under the Affordable Care Act (ACA), individuals must have minimum essential health coverage or pay a penalty. Gather all the necessary information related to your health insurance coverage, including Form 1095-A if you purchased coverage through the Health Insurance Marketplace.
Step 6 – Gather Tax Credit Information
If you qualify for tax credits, such as the Earned Income Tax Credit (EITC) or the Child Tax Credit (CTC), make sure to gather all the necessary information to claim them on your tax return.
Conclusion
Gathering all the necessary information to file your taxes can be a daunting task, but it’s crucial to do it accurately and on time. Make sure to follow these steps and gather all the information to avoid potential tax penalties and maximize your deductions and credits. Remember, if you’re unsure about any information, seek guidance from a tax professional.
