Now that the holidays are in the rearview mirror and it is the start of a new year, it’s time to think about getting ready for filing your tax returns. Gathering and organizing your records in order to file your taxes could be one of the nicest things you do for yourself (and your accountant). Taxpayers should gather all year-end income documents before filing a 2021 tax return. Don’t wait to get this done, lower your anxiety and prepare now to avoid processing delays that may slow your refund.
Keeping things clear and accurate starts by having all the necessary documents before starting to prepare your return yourself or with the help of a trusted tax accountant.
This helps in the filing of a complete and accurate tax return. Here are some things taxpayers need to have before they begin doing their taxes or getting a trusted tax accountant to work with them.
- Make sure you have all the Social Security numbers of everyone listed on the tax return. Many taxpayers have these numbers memorized and sometimes our memory isn’t a reliable source. it’s a good idea to have them on hand to double check that the numbers on the tax return are correct. An SSN with one number wrong or two numbers switched will cause processing delays.
- Bank account and routing numbers. People will need these for direct deposit refunds. Direct deposit is the fastest way for taxpayers to get their money and avoids a check getting lost, stolen or returned to IRS as undeliverable.
- Don’t have a bank account? Learn how to open an account at an FDIC-insured bank or through the National Credit Union Locator Tool. Veterans can access the Veterans Benefits Banking Program.
- Forms W-2 from employer(s).
- Forms 1099 from banks, issuing agencies and other payers including unemployment compensation, dividends, distributions from a pension, annuity or retirement plan.
- Form 1099-K, 1099-MISC, W-2 or other income statement for workers in the gig economy.
- Form 1099-INT for interest received.
- Other income documents and records of virtual currency transactions.
- Form 1095-A, Health Insurance Marketplace Statement. Taxpayers will need this form to reconcile advance payments or claim the premium tax credit.
- Letter 6419, 2021 Total Advance Child Tax Credit Payments, to reconcile advance child tax credit payments.
- Letter 6475, Your 2021 Economic Impact Payment, to determine eligibility to claim the Recovery Rebate Credit.
Forms usually start arriving by mail or are available online from employers and financial institutions in January. Taxpayers should review them carefully. If any information shown on the forms is inaccurate, the taxpayer should contact the payer ASAP for a correction.
If you don’t plan on doing your taxes yourself and need a Tax Accountant, contact us today. The TYS team are Your Trusted Business Advisors and Accountants.