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Preparing to Do Your Taxes

By Dean ‘Mac’ Nichols, Attorney

New Tax Return | Layman & Nichols LawIt’s that time of year again when everyone begins prepping in earnest. As you begin preparing your yearly income tax return or gathering your tax documents to give to your preparer, take a look at the following:

For starters, you’ll need the Social Security Number’s and dates of birth for you, your spouse and any dependents.


You’ll want to have the following information about your income:

• Business or farming income and expenses, plus capital equipment information
• If you use your home for business (and it qualifies for a deduction), know your home and office square footage, as well as home and office expenses
• State and local income tax refunds
• Income from sales of property: original cost and cost of improvements, closing statement, cancelled debt information (form 1099-C)
• Investment income on various forms 1099 (-INT, -DIV, -B, etc.), K-1s, stock option information
• IRA/pension distributions shown on forms 1099-R and 8606
• Other miscellaneous income: jury duty, gambling winnings, Medical Savings Account (MSA), withdrawals, scholarships, etc.
• Prior year installment sale information: form 6252, principal and Interest collected during the year, SSN and address of payer
• Rental property: income/expense, depreciation information, rental property suspended loss information
• Alimony received
• Social Security benefits: form SSA-1099
• W-2 forms for your and your spouse’s Income from jobs
• Unemployment Income: form 1099-G
• Information regarding health insurance coverage

The following adjustments to gross income can help reduce your amount of taxable income:

• Alimony paid
• Educator expenses
• IRA contributions
• Keogh, SEP, SIMPLE and other self-employed pension plans
• Medical Savings Account (MSA) contributions
• Moving expenses
• Self-employed health insurance payments
• Student loan interest

You’ll also want this information for eligible deductions and credits:

• Adoption costs: SSN of child, legal, medical, and transportation costs
• Casualty and theft losses: amount of damage, insurance reimbursements
• Charitable donations: cash amounts and value of donated property, miles driven, and out-of-pocket expenses (obtain and keep receipts from organizations for contributions in excess of $250)
• Child care costs with provider’s name, address, tax ID number, and amount paid
• Education costs: form 1098-T, education expenses
• Home mortgage interest and points you paid, form 1098
• Investment interest expense
• Medical and dental expenses
• Other miscellaneous tax deductions: union dues, unreimbursed employee business expenses (uniforms, supplies, seminars, continuing education, publications, travel, etc.)

When preparing to do your taxes, along with the applicable information from the lists above, you’ll also want to keep proper documentation of deductible taxes you’ve paid such as state income taxes, personal property taxes, and real estate taxes. Have your direct deposit information, as well as the total tax payments you made during the year, any refund applied to the current year from the prior year, and any amount paid with an extension to file your return.

If we can help you with your income tax filing needs this year, please give us a call today (540.433.2121).

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