What do i need to file taxes

what do i need to file taxes

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IRS Forms

You need tax forms if you're not filing electronically. This includes Form 1040, the basic two-sided tax return. You may also need Schedule A if you're itemizing deductions, Schedule B for declaring any interest income, Schedule C for business or self-employment income, Schedule D for capital gains, and Schedule SE to figure your self-employment taxes. If you qualify for the earned income credit, you'll also need Schedule EIC. All tax forms are available on the IRS website and can be printed directly from there, or filled out online and then printed and signed before filing.

Wage Statement

If you were employed during the tax year, you need a W-2 or wage statement. This details your gross income as well as all deductions, including federal and state taxes. Payroll taxes include Social Security and Medicare tax. If you earn tips as allocated by your employer -- not directly paid by your customers -- this amount also shows up on the W-2. Dependent care benefits and contributions by your employer to non-qualified retirement plans may also be counted as taxable, and those amounts appear in Box 11 and Box 10 of the W-2, respectively. You won't need any other paperwork to document these amounts, but you must file any W-2s with the IRS.

Miscellaneous Income

Interest income, capital gains and income from rents and royalties will appear on Form

1040. You will need account statements, trade confirmations for any buying and selling of securities, and receipts for miscellaneous income to back up this information, although this paperwork does not need to be filed with the tax return. If you own a house, you'll need escrow statements for documenting mortgage interest and real estate taxes paid. If you sold a house, you may owe on the capital gain, so keep a copy of that closing statement.

Business Documentss

If you own a sole proprietorship business or are self-employed, you need documentation of your gross income as well as receipts for all deductible expenses. You also have to document cost and value of inventory -- for year start and year end- - if you're selling goods. If you're taking a standard mileage deduction, you need some kind of record of miles driven for business -- personal mileage is not deductible. The easiest way to keep track of all these numbers is to buy tax or accounting software and keep your physical records filed away.

E-Filing and Paperwork

If you file electronically, you won't need to submit a paper W-2 directly to the IRS, but you must provide a copy to the authorized e-filing provider. If there are any forms that must go in, such as a letter of explanation, you'll transmit them with a Form 8453, "U.S. Individual Income Tax Transmittal for an IRS E-File Return."

Source: ehow.com

Category: Taxes

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