How to Gather Your 2020 Tax Return Information Easily
Are you always last-minute scrambling to gather your tax information? Fear not! With the tax season approaching, it’s time to start gathering your documents. In this article, we’ll guide you on how to easily gather your 2020 tax return information.
Start with the Basics
Before you start with the actual process of gathering your information, make a list of all the documents you’ll require. The most basic ones include your social security number, W-2 forms, and 1099 forms (if applicable). Also, make sure you have the details of any irregular income you earned during the year.
Organize Your Records
To make your tax journey easy, it’s essential to have an organized record-keeping system. Whether you prefer paper or digital files, organize them into folders such as income, deductions, and charitable donations. Also, ensure you keep all the receipts and statements that support your financial records.
Collect Investment Records
If you have investments, whether they are stocks, mutual funds, bonds or real estate investments, look for records of purchases, sales, and dividends received. Brokers typically issue Form 1099-B statements, which provide details on the sales proceeds, whereas mutual fund companies provide Form 1099-DIV statements.
Get Your Health Coverage Information
To prepare your tax return, you’ll also need information about your health insurance coverage. If you have health insurance through your employer, you’ll get Form 1095-B. It’s crucial that you check and make sure the information provided on your Form 1095-B is accurate.
Consider Hiring a Professional
If you find the process of gathering your tax information overwhelming, it may be best to hire a professional to help you out. Many individuals prefer to use tax software like TurboTax or H&R Block, but if your tax situation is complicated, it’s best to consult a tax professional.
Conclusion
Gathering your tax information may seem like a daunting task, but it’s necessary to avoid last-minute chaos. Start by making a list of the basic documents you’ll need, organize your records, collect investment records, retrieve your health coverage information, and consider seeking professional help. With these steps, you’ll be prepared for tax season and have a stress-free filing experience.
