Tax Checklist Management – Things You Need To Add
Are you aware that you can receive a penalty of 5% unpaid tax per month whenever you file your taxes past the deadline? 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.
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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 your taxes is quite the daunting task without the right checklist, but with proper preparation you can go through with it in a breeze. Here below are some tax checklist tips for you to consider.
Make Sure Your Personal Info is Correct
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. Individuals such as your partner, your children, and other dependants.
Never Forget Your Income Info
You have to document all of your sources of income if you wish to properly manage your taxes. 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 you and your spouse.
Received income from alimony.
Social security Benefits will require Forms SSA-1099
Pension distributions and IRA will require Forms 8606 and 1099-R.
1099 forms for any income received 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. For income documentation, you can make pay stubs through the use of online pay stub generators.
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Don’t Forget to Include Income Deductions in Your Checklist
Income deductions can significantly reduce taxable income. Your refund can significantly be increased as well as reduce the amount of money you owe.
Pay Attention to Tax Credits
Tax credits are immediately deducted from the tax that you owe. These will need documents in order for you to claim them, however. Here’s a list of common tax credits
Retirement savings contributions.
Child tax credit if you have children below 17 years of age.
Paying attention to your credits will help you secure a tax withholding reimbursement. Credits can either be non-refundable or refundable. If your refundable credit exceeds the amount of your taxes, you get a refund of the difference.
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