Tax Matters

Tax Matters

Telephone: 949.515.2862 | Fax: 310.857.6108

Checklist for Tax Interview

W-2s: Be sure you have one for each employer you worked for during the current taxable year. Employers have until January 31 of the following year to mail the forms to you, but sometimes they don't act in a timely manner. If the employer has gone out of business or if you have moved and not notified the employer of your new address, there could very well be a delay in getting those forms to you. You should verify the amounts on the W-2 form with your last pay stub from each employer.

1099s: You will receive a 1099-INT from every payer of interest and a 1099-DIV from every payer of dividends. In addition, broker accounts and/or mutual funds will issue a 1099-B to report the gross proceeds from the sale of securities and mutual fund shares.

Other 1099 forms that may come to you include 1099-S for the sale of real estate, 1099-SSA to report social security benefits, and 1099-R for distributions from pensions, annuities and IRAs. State unemployment state income tax returns, and gambling winnings are also reported on separate 1099 forms. Independent contractor fees, director fees, executor and trustee fees are all reported on 1099-MISC.

1098: This form reports interest you paid on a mortgage or home equity loan. Real estate taxes, if paid from an escrow account with the lender, are also shown on this form.

Schedules K-1: If you were a partner or limited partner in a partnership or a shareholder in a Sub-Chapter S Corporation, the tax ramifications of your participation are reported on Schedule K-1. If you were the beneficiary of an estate or trust during the current taxable year, a Schedule K-1 will be sent to you outlining the taxable income from this source. Typically, these forms are not sent to you by January 31. Please remember there is important tax information on these schedules and your tax return cannot be prepared without them.

Purchase/Sale/Refinance of Personal Residence: If you buy a home or refinance one, we need the settlement or escrow statement. If you aren't sure which one that is, bring all the forms given to you at closing. If you sold property, you'll need to bring the original purchase information along with the sale papers and data regarding improvements you made to the property.

Stock Sales: If you sold stock during the year, we need the purchase date and purchase price and/or records of cost basis. If you sold a mutual fund (even if you "moved" from one fund to another), please bring the year-end statement for each year of ownership, unless the company has provided you with cost information.

Business Purchases: If you purchased new equipment for your business or for use as an employee, bring the receipts or contracts. If you purchased or leased an automobile, bring the papers detailing the price, trade-in, sales tax, and lease term.

Mileage: If you intend to claim miles for business use, you must have a log. This log will have the total miles for the year, as well as notations regarding the business miles and business purpose that are part of the grand total. If you are leasing your car, in addition to the mileage log, you need to provide all expenses, including gas, oil, insurance, license, repairs, and the amount of the lease payments. In addition to the mileage, be sure to have the receipts for parking and tolls.

Mileage can also be claimed for medical and charitable purposes, but again, a log is your best indicator of the deduction that is available to you.

Charitable Deductions: Federal tax law requires a written acknowledgment from a charity for any single contribution of $250 or more. An itemized deduction is not permitted unless the acknowledgement is received prior to filing the tax return. For all other contributions, receipts and cancelled checks are good proof for the deduction. If you contributed items in kind (clothing, toys, household items, automobiles), you will need an itemized list for amounts over $500 in addition to the receipt from the organization.

Estimated Tax Payments: Please be sure to have a list of when and in what amount your payments were made for the current taxable year. Remember, the payment made in January of this year counted towards last year's taxes.

Child Care Expenses: To claim child care expenses to either an individual or a daycare center, be sure you have the complete name, address, and tax identification number, as well as the name of the child and total amount paid for child care in the current taxable year.

Hope and Lifetime Learning Credits: If you have education expenses for which you want to claim a credit against your income tax, be sure you have the amount paid in the current taxable year for each person who is eligible for this credit. There are different limits for each of these credits.

New Dependents: If a child was born in the current taxable year or you completed the adoption process for a new dependent, please provide a copy of the social security card as well as complete name and birth date. If there are other dependents you are eligible to claim this year, be sure to have their information with you as well so the exemption can be properly claimed.

Miscellaneous: The list just given is a generalized list, some of which may not apply to your return. A good checklist is to review last year's return and use that as a guide for the documentation you'll need to bring to insure an accurate tax return is prepared on your behalf.

As always, your call is welcome anytime to verify other items that may be needed for your tax return.

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