Preparing For Your Tax Return

With the April 18th tax deadline fast-approaching it is time to turn our attention to personal tax returns. Collecting what is needed can be overwhelming but if you follow the information below you can simplify the tax preparation process and eliminate any trepidation you have about completing your return.

• 2014 Personal Tax Return: Hopefully you have retained a copy of your prior-year tax return. If you are unable to locate the 2014 tax return, be certain to have personal information (names, social security numbers, address) readily available. You may also want to bring your bank account and routing numbers, both of which can be found on a blank check.

• W-2 Forms, 1099 Forms & 1098 Forms: Your employer is required to provide you with Form W-2, which summarizes both your 2015 earnings and amounts withheld from your pay, as of February 1, 2016. Form 1099 summarizes other earnings including those you have generated as an independent contractor, interest, social security benefits, etc. The different versions of Form 1098 summarize amounts you have paid. These include mortgage interest, student loan interest, and tuition expenses. Both Form 1099 & most versions of Form 1098 must be provided to you by February 1, 2016.

• Listing of Monies Paid: There are other amounts that you may have paid during the year, and which can influence your total tax owed. These include retirement plan contributions, student loan interest, childcare costs, investment interest expenses, donations, medical expenses, and real estate taxes paid. Compile any tax documents you receive that relate to these amounts, and bring both totals and supporting documentation for all others that apply.

• Schedule K-1: If you are the owner of a business (either full or in part) then upon the completion of the corporate tax return (which is due by March 15th) you will receive a schedule K-1 showing your portion of the profit or loss. This amount must then be included on your personal tax return.

• Overview of Significant Life Events: Certain major life events will be impactful on your tax return. Among these are marriage, divorce, birth, death, adoption, casualty losses (a home fire, for example) and/or theft of personal property. You should make your tax preparer aware of any of these events that occurred during 2015.

While other information may be necessary, often these items are sufficient. The completion of your personal tax return need not be a nerve-wracking experience. If, after reviewing the above list, you have any questions, contact your accountant. A quick conversation should clear up any questions you may have.