Tax Checklist Management – Things You Need To Add
Are you aware that failure in filing your taxes on time has a penalty of 5% unpaid tax monthly? If you file your taxes 60 days past due then you are also obligated to pay $135 minimum or how much money you owe the government in total, whichever is lower.
Check this website for more information.
IRS reports state that more than 5% of Americans have failed to file taxes in the year 2018 alone and have amassed about $130 Billion Dollars in back taxes, interests and penalties.
There is more information for you to view here.
Not having the proper tax checklist can make filing taxes a stressful endeavour, but with careful preparation it can be done with ease. Here are some tips in making your tax checklist.
Make Sure Your Personal Info is Correct
The IRS needs you to fill in your correct personal information, birth date, and social insurance. It is also advised that you include correct information regarding individuals you have covered under your tax returns. These include your children, your partner, and or other dependants.
Do Not Forget to Include your Income Information
You need to write down all of your sources of income in order for you to manage your taxes. These include any businesses, income from investments, and employment. Below are forms that you will need when you file your taxes.
W-2 forms you’re your you and your partner’s income from employment information.
Income from alimony.
Social security Benefits will require Forms SSA-1099
You will need Forms 8606 and 1099-R, these are for pension distributions and IRA.
1099 forms for your investment income
Click to learn more now!
Make sure to have the proper IRS form for specific income sources. Other sources of income such as jury duty, winnings from gambling, scholarships, and medical savings account, also need to be reported. You can make pay stubs through pay stub generators so you can document your income better.
Click here if you wish to read read more.
Don’t Omit Income Deductions from Your Checklist
Your taxable income amount can easily be reduced by income deductions. This will help increase your refund and lower the amount of money you owe.
Pay Attention to Tax Credits
Tax credits are directly deducted from your taxes. But, you require documents in order to claim them. Here below are a list of common tax credits.
Child tax credit for when you have children under 17 years of age.
Education credits for example tuition fees and the likes
Keeping an eye on your credits can greatly help in getting you a refund of your withholding tax. Credits are either refundable or non-refundable. If the taxes you owe are less than your refundable credit, you can receive the difference as reimbursement.
Click to read more now.