Business

What you need to know to file your taxes

Unless your financial situation is so set in stone that it never changes, it’s worth asking yourself each year whether you should do your taxes yourself of get someone to do them for you. If your income is modest and your situation relatively straightforward, you can save yourself a hefty fee payment by doing the taxes yourself. The IRS actually encourages this and has refined the process to make it as simple as possible. The key to filing successfully is making sure you have all the necessary forms.

Proper preparation

Draw up a checklist of all the places you have worked in the past year, as well as all the banks and other financial institutions where you hold accounts. You can then cross off the forms and statements as you receive them.

Double check everything by comparing the information to your own records as you will need to leave enough time for the company to issue you with a new form if they have made a mistake. Give yourself plenty of time: it is crucial to ensure all your forms are submitted well ahead of the deadline as there are penalties imposed on those who file late

W2

The W2 is by far the most important form you need in order to file your taxes as it show exactly how much you earned and the amount of money withheld for Medicare, income tax and social security. It will also contain details of any contributions you made towards a child care plan, a retirement plan or medical plan.

Your form should arrive in late February and if it fails to turn up by then, you may start to be concerned and might even start considering paying a third party to provide you with a form. You might also be wondering how can I get my W2 online for free? Simply follow the link and you’ll be taken to a site where you can generate a correctly filled in W2 form in a matter of minutes.

1099

This form is required if you have a savings account or if you have other forms of income that have not come from one of your employers. You’ll also need this form if you have earned interest on your savings. It might be an idea to make a list of all the places you expect to receive a 1099 form from and ensure they all arrive in good time.

The exact 1099 form you require will depend on whether or not you are an independent contractor. Always bear in mind that the companies that issue these forms will also send copies to the IRS, so failing to include all the information on all the forms you receive will lead to your calculations being incorrect.

Additional forms

You may need to provide additional or fill in additional forms under certain circumstances, such as qualifying for tax credits. In this case, the person who cares for you child will need to provide a statement containing their business tax identification number.

 

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elliott

elliott

Ive been blogging now for 5 years on various sites for the love of knowledge share. I decided to start my own blog a few years back to share everything from tech to business news. Follow me on twitter for more.