Few people enjoy filing their income taxes. The process can be made less stressful by gathering all the information you need, whether it's personal, income or employment data. Finishing tax preparation as fast as possible is the chief goal of many taxpayers. However, information must be provided to the IRS accurately to avoid an audit, which can be a difficult process. Many people have a tax professional prepare their taxes for them, but the professionals must acquire the information from you.
The IRS requires that you provide certain personal data when completing tax forms. Required personal information includes the Social Security numbers for you, your spouse and your children. If you provide child care, your child care provider's tax identification is also required.
W2 forms are needed to complete your income tax. Your employer is required by law to send these to you. W2 forms list the amount of money your employer paid you during the previous year and the amount deducted for taxes and Social Security.
Other Income Data
Data on any additional income that did not come from your main employer must be gathered. For example, financial providers should send you statements regarding the amount of money you made from pensions and annuities. Court clerks should provide you with the amount of money you made serving on jury duty. Banks or other financial institutions should send you information on interest income and dividends. Gambling and lottery winnings information may come from an IRS Form W-2G provided by the payer.
If you own a home, mortgage interest needs to be reported on your income taxes. The mortgage lender will send you this information on Form 1098. Provide the amount of real estate taxes you paid last year. The lender or county clerk may send this data to you. If you sold your home during the year, provide the IRS with the amount of money you earned for the transaction. Your lender or closing agent should send this information to you with Form 1099-S.
Freelance income during the year must be reported it to the IRS. Whoever paid you should send you the amount you made on Form 1099-MISC.
No one's taxes are the same. Additional information concerning capital gains, business losses, deductions and other financial data may be required by the IRS depending on your situation. Check with a tax professional or visit the IRS website to determine what information you need to provide.
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