This post is part of the TaxACT #BeatTheDeadline blog tour which shares tips on how to make tax time a smooth and easy process before the April 15 deadline. TaxACT provides the tools and guidance to help you confidently file taxes easy and fast. Do your own taxes today at TaxACT. You got this.
If you want your taxes to be done smoothly, with minimal headache, it’s imperative to get everything in order before you start. After all, it’s very easy to sit down with the best of intentions, but then need something to complete your work, get up, and get distracted. Between doing your taxes and watching a game on TV, what would you rather do?
However, you can beat the deadline and get your taxes done all at once by gathering the necessary tax documentation now. Here’s what you’ll need to get everything done at once.
The Greek aphorism to know thyself really comes in handy during tax time! You’ll need your social security number, and your spouse’s, if you’re married. If you have children, it helps to know their names and social security numbers. While you don’t need it, it is helpful to have last year’s tax return handy to use as a comparison and review tool.
You’ll also want your bank account number and routing information handy, particularly if you want your refund deposited directly into your account. Be aware that you can also pay from this account if you owe money to the government. It is free to pay the IRS through your bank account, and you can choose the date you want the money taken from your account.
If you have children, in addition to their personal information, you’ll also want their child care records and provider’s ID number, if applicable. If you’ve adopted a child, you’ll need records of the legal, medical, and transportation costs associated with the adoption.
By now, you’ve probably started to receive emails and letters from your employer, bank, loan institutions, etc. with tax documentation that reads “Form ####”, or other IRS documentation along those lines. Even if your credit union form only says you received $15 in refunds, don’t toss this documentation!
Collect everything that looks official or reads “Form (numbers and letters, sometimes just numbers). Specifically, you’ll need the following work documentation:
- W-2s – wages and salary
- Amount of any alimony you’ve received and your ex-spouse’s name
- 1099-SA – MSA or HSA distributions
- 1099-R, 1099-INT, 1099-DIV, 1099-G – Don’t get confused about all the 1099s. All of these have to do with retirement income, interest, dividends, and government payments
- SSA-1099 – Social Security benefits, if you get those
- Forms 1099-MISC – for self-employed people, miscellaneous income not reported on other 1099s
- Schedule K-1 – usually for self-employed people, this is a report of partnership income or loss
Don’t panic if you don’t have all of these forms! If you’re not self-employed, have minimal investments, no children, and don’t have your own (profitable) side hustle, you likely won’t have more than 4-5 pages of documentation to collect.
Additional work information you may want to have on hand:
- Unreimbursed mileage related to work
- Contributions to retirement plans (IRAs, 401(k)s, etc.)
- Healthcare expenses
- Self-employment income and expenses, including home-office expenses, health-insurance premiums paid, transportation costs
If you’re still in school, or taking higher education classes, you may qualify for the American Opportunity Credit or Lifetime Learning Credit. You can only choose one of the credits. You can claim an education credit if you, your spouse or your dependent was a student enrolled in or attending an eligible educational institution.
Some differences between the two credits include:
- American Opportunity Credit: maximum credit of $2,500 per eligible student; Lifetime Learning Credit is $2,000
- The American Opportunity Credit is available only for the first 4 years of postsecondary education, whereas the Lifetime Learning Credit is available for all years of postsecondary education and for courses to acquire or improve job skills.
- The AOC requires the student to pursue an undergraduate degree (or beyond), while the Lifetime Learning Credit does not require the student to be pursuing a degree
If you have taken any classes for a higher degree or to improve your job skills, it’s worthwhile to collect any tax documentation related to your education. Make sure you have your school’s name and location, and any receipts you may have from paying for classes. While this isn’t necessary to complete your taxes, it’s money on the table you shouldn’t pass up!
For those of us with student loan debt, we have some options for deductions as well via the 1098-E. You should receive form 1098-E through your loan institution, either via email (if you signed up for electronic communication) or by mail. This document tells you how much student loan interest you have paid so far on your debt. You are able to deduct a maximum of $2,500 in student loan interest paid last year. This student loan interest deduction does phase out based on your modified adjusted gross income.
If You Itemize Your Deductions
If you itemize your deductions, you’ll want to have the following information on hand:
- Form 1098 – mortgage interest
- Investment interest expenses
- Charitable donations – including receipts for donations made to your child’s school
- Any home business expenses you have
- Rental property income and expenses
While it seems like there is a lot of information to collect for your taxes, it’s really not as insurmountable as it may seem. Depending on your situation, you likely will need only several pieces of documentation and should be able to complete your taxes in an afternoon.
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