What Tax Documents Should You Collect at the End of the Year?
Brookline, NH Resident Looks to Plan Ahead
Employers and financial institutions have until January 31st to send your end of year tax documents. Knowing that this will be coming soon, it is a good idea to keep an eye out for these critical items. This includes a W2 from employers, 1099-INT and 1099-DIV from financial institutions documenting interest and dividends earned throughout the year, Form 1098 outlining any mortgage interest paid, and additional 1099 forms for other income earned.
A resident in Brookline was trying to be as prepared as possible for filing her taxes. Not wanting to wait until the last minute, she contacted Merrimack Tax Associates about what paperwork she would need to start gathering.
IRS Forms Documenting Sources of Income
It is important when it comes time to file your taxes that all earned income throughout the year is claimed. Full and part-time employees will receive a W2 from their employer, outlining wages earned and tax that was withheld. Self-employed individuals will likely receive 1099 Forms for income received. Your financial institution will send a 1099-INT or 1099-DIV to show earned money through investment interest and dividends paid. Depending on the total amount, if you received other income throughout the year, from prizes and gambling winnings to your state tax refund, you would receive forms that will need to be submitted with your tax return to claim this money as well.
Forms for Claiming Deductions on Your Taxes
You can begin putting together the deductions that you can claim on your taxes, including supporting documents and receipts. For self-employed individuals this includes check registers, credit card statements and store receipts documenting your expenses. Homeowners can deduct their mortgage interest and any qualified energy-efficient home improvements. Charitable donations, both cash and non-cash, can also be deducted on your taxes. You will need receipts to support this deduction.
The Brookline resident now has a better understanding of the information that she can begin putting together to make sure her tax filing goes as smoothly as possible.