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It is time to do that dreaded tax return.  Actually, since most Americans will receive a refund rather than have to pay,Richard Leaman it should really be a time to look forward to getting some needed cash.  Whether you prepare your return by hand, utilize a computer service to help you prepare and file it or have it done professionally, there are certain steps you need to do before starting.

Organizing Your Information

Certain documents must be received before you can start.  The most obvious is a W-2 if you are an employee.  If you work at more than one job you must get a W-2 from each employer.  Employers are required to mail W-2’s by January 31 but often are a few days late.  If you do not get your W-2 within a reasonable time, you should contact your employer.

While the W-2 is the only absolutely essential document you need to file your return since a copy must be attached, it is best to wait until all information returns that are filed with the Federal Government are received.  This include Forms 1099 where interest, dividends, annuity and pension income are reported along with other miscellaneous income. Check the form against your records and if they do not agree, contact the issuer to resolve the discrepancy.   Two particularly important forms are Form SSA-1099 which reports Social Security Benefits and Form 1098 which reports mortgage interest.  If you have a health savings account, Form 1099-SA must be received in order to prepare your return.

Other forms are also needed which do not need to be filed with the government.  If you are homeowner, in addition for Form 1098, you should receive a reconciliation of your mortgage escrow account.  This show payment into escrow and property tax payment out of escrow.  Property taxes are not deductible when paid into the account but only when the account pays them to the state or county.  Essentially payments are deductible the year after they are paid.

Of course, the real drudgery begins when you fetch your banking statements and other records.  These are essential, however, to examine carefully for potentially deductible expenses and income you may have forgotten.  Charitable contributions are not deductible unless you have adequate bank records or acknowledgment from the recipient.   Contributions of $ 250 or more require acknowledgement from the recipient.  Look through your bank statements for potentially deductible employee business and investment expenses such as union dues and business periodicals.

Finally look for miscellaneous items that might support deductions.  If you gave away clothing to a thrift shop retain your receipt.  Remember clothes and personal items are only deductible if in good used condition.  If you gave away an old automobile to a charity, make sure you have proper documentation.

Always keep in mind that a little preparation will pay off both in time saved when preparing your return and taxes saved through deductions you may have forgotten.


If you’d like to look into getting help with your taxes, try DU’s Volunteer Income Tax Assistance (VITA) program at today.