List of Tax Information Needed to Prepare Taxes
Every April, Americans file tax forms legally mandated by the federal government, and, with few exceptions, state governments. Whether completing the tax forms and filing yourself or hiring an accounting professional to tackle both duties, preparing the personal paperwork and obtaining the necessary forms requires attention to details. Even when using online systems, filing requires organization of basic statements and official forms listing income and amounts for itemizing expenditures as deductions.
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Income Statements
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Taxpayers use income statements, including W-2 and 1099, to file federal and state taxes. Employer-prepared W-2 forms document wages earned by the holder of the Social Security number. People with self-employment income receive a 1099 statement from each firm employing the person for freelance or contracted work over a set amount mandated by law. This benchmark earning to receive the 1099 income statement in 2010 was $10 for royalties and $600 for other payments, but the amount varies from year to year.
Interest, Bank and Dividend Statements
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Federal law requires banks, credit unions, and savings and loans to issue statements posting interest earned on all accounts with the institutions. Taxpayers use these statements to complete tax preparation under the income portion of the tax forms. People receiving stock dividends, retirement payments, child support, pensions, alimony, trust fund payments and any other interest income, either passive or active, must use the exact figures reported to the IRS by the agency or person contributing to the filer's income.
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Tax Forms
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Filing taxes requires access to snail-mail to request the forms, or access to a computer, printer and Internet connection to download forms from the state and federal government websites. Federal filers have the option of using short, or easy, forms, or filing long forms allowing the taxpayer to itemize tax deductions. Beginning in 2011, the IRS no longer automatically mails tax forms to filers without a formal request via snail mail or telephone, or a request made in person. Public libraries, post-secondary institutions and senior centers in many areas provide complimentary copies of both state and federal tax forms. The federal government and many states, including Indiana and California, offer the option of filing taxes online without the task of collecting paper forms.
Instruction Booklets
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Direction booklets accompany federal and state general tax forms, if requested prior to the tax filing date. Filers also have the option of obtaining the instructions from the online filing and information websites. Instructions also accompany individual federal tax filing forms. The directions guide the taxpayer with line-by-line instructions for completing the form. Directions also typically include commonly asked questions and official answers.
Receipts and Paperwork for Deductions
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Taxpayers taking deductions on tax forms must also collect paperwork documenting the deductions and any appropriate receipts. Mortgage holders, for instance, file IRS Form 6251 using documents provided by the lender to report interest paid during the tax year. The preparer also requires statements for any individual retirement accounts opened in the tax year to reduce tax liabilities. Workers with mandated expenses not reimbursed by the employer and filers with college expenses required to maintain employment also need receipts to document these expenses.
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References
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