So, you have today off.
And, I am presuming you are of sound mind and body, having NOT gone overboard with your celebrations last night.
Which makes today a great day to create your folder for tax documents.
Nowadays, many of your items are available electronically- so there’s no need to wait for a paper copy to arrive by snail mail. And, we suggest you put 10 pages into this folder- which can be a paper folder or an electronic one. (If you are using paper, different colors work best so you can keep things organized- or you can use divider tabs.)
#1. A list of all W-2’s you should be getting. One from each employer from which you received a pay check.
# 2. A list of all 1099’s you will be getting from your gig activities- consulting, driving an Uber, honorariums, etc.
# 3. A list of all 1099’s you will get from every bank account that pays interest, dividends from mutual funds and stocks, stock sales, and mutual funds (typically reporting capital gains and dividends).
# 4. A list of all K-1’s you will get from partnerships, S entities, LLC’s, REIT’s, etc.
#5. A list of all 1099R’s and W2P’s for all pension, retirement funds, withdrawals from IRA’s, and 401(k) distributions.
# 6. A list of all 1099’s you will get for any unemployment checks, Social Security benefits, and state income tax refunds.
# 7. A list of 1098’s received for all mortgage payments. These should also list the property tax paid for each property. (If you pay them directly, go to your county website and download a record of all payments made this calendar year.)
# 8. A list of all dates you were away from home on business so the per diem deductions can be determined. (If you spent the night in a hotel, this is where these should also be recorded.)
# 9. A list of any IRA or 401(k) contributions made during the year. This is also where you should write down how much that contribution you’ll be making before you file your taxes. (It is the maximum allowed by law, right? And, if you don’t have an IRA, you do know that you can start and fund one up until the 15th of April- the filing deadline. Don’t forget!)
# 10. A list of all estimated tax payments made to the Federal government and to your state taxing authority during the year. (The normal deadlines is 15 April, 15 June, 15 September, and 15 January- of the next year.)
Having these lists- and then crossing off each item when you receive or download them- will make it clear when you are able to begin processing your 2019 tax returns.
Oh, Roy, you had to remind me of taxes! Ugh! But thank you. I guess.
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Better now than the 14th of April. Look how many grey hairs I prevented 🙂
AHHHHH… the perks of living on Social Security…. no more paying taxes.
Eydie Stumpf recently posted..Writing the Words that are Difficult to Speak
Of course, your income is also greatly attenuated…
But, sure, if that’s how you like it, Eydie!
Taxes… yeah! I wish I had reasons for all those forms you listed out! Would you care to pay me an honorarium? I think that would be a good start!
Thanks, Roy!
So, Paul, the list was meant to be inclusive- leaving nothing out. I don’t have many of those things, either.
Great List Roy. I am at a point now that I really don’t have much of that left. My tax accountant told us (Wife and I) that we no longer needed to file taxes because our total income is just below the tax line. I file it anyway just so I have a record of everything in case I ever start making money again I won’t have any gaps with missing years to explain. We are retired and living in Mexico so I don’t foresee working again but you never know. My website might bring in a buck or two.
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I can’t quite say that’s great news- since I’d love for you to be making money that you had to pay taxes. But, you do know that given your stated condition, you can file electronically for free!
(I can also add that if you are making money as an independent contractor- which is what I think- you should file Schedule C for the 1040 to absolutely protect yourself. Regardless of the income volume.)
WOW, thanks for all the great tips! I am still “old school” and like to keep paper copies. You make it sound easy and by starting in the beginning instead of the end of the year makes it extremely well planned. Glad to see you back in the challenge.
I would hate to see how much space those file cabinets take in your home, Martha!
I do recall having about a dozen 4 drawer units- now, all replaced by a 3.5*5*1/2 inch rectangular solid…
Some great advice.We have different tax docs but keeping papers in order makes sense.
Glad it could trigger ways to help you comply with your regional regulations, Dr. A!
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Thank you so much. Not sure that my blog ever received that approbation.