Tax Checklist Management – Things You Need To Add
Did you know that you can get a 5% unpaid tax per month due to failure of filing your taxes on time? You also have to pay a mandatory $135 or the sum of taxes you’re indebted to pay the government(whichever is the lower amount) if you file 60 days past due.
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IRS reports have stated that about 5% of Americans were unsuccessful in filing their taxes in 2018, they have accumulated up to $130 billion dollars in debt to the IRS in penalties, back taxes, and interests.
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Filing taxes can be tough if you don’t have a proper tax checklist, but it does not have to be so if you prepare right beforehand. Consider these 5 tips in making your tax checklist.
Clarify Your Personal Info
The IRS will require you to fill in the proper personal information, your social insurance, and your date of birth. It is a must that you include detailed and accurate information regarding individuals that are covered under your tax returns. These include your children, your partner, and or other dependants.
Remember to Include Your Income Info
You must record all of your sources of income for proper tax management. Things such as investment income, businesses, and employement. Below is a list of forms you will need when filing taxes.
W-2 forms for the employment income information of your spouse and yourself.
Received income from alimony.
Forms SSA-1099 for your social security benefits.
Forms 8606 and 1099-R.
Different 1099 forms for income from investments.
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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.
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Don’t Forget to Include Income Deductions in Your Checklist
Your taxable income amount can easily be reduced by income deductions. Your refund can significantly be increased as well as reduce the amount of money you owe.
Pay Attention to Tax Credits
Tax credits are directly deducted from your taxes unlike tax deductibles that work to reduce the amount of income that is taxable. These will need documents in order for you to claim them, however. Here below are a list of common tax credits.
Child tax credit if you have children below 17 years of age.
You will be able to get a significant reimbursement of your tax withholding if you pay close attention to your credits. 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.
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