Tax Form Checklist

Every year it comes, and every year, people think they’re ready for it. The long phone calls, frantic searches for missing documents, avalanches of “Important Tax Notices”, and anxious hand-wringing over refund amounts; tax season has earned the dread it inspires. To help mitigate the yearly scramble to gather up your tax materials, we’ve put together a checklist of tax documents, so that you can know what you’ve already collected, and what you should keep an eye out for in the future.

INCOME

  • W-2- This is a wage statement issued by an employer showing year-end earnings and tax withholding amounts. All employers, regardless of amount earned, are required by federal law to issue either a digital or paper copy of these forms to every employee. The forms must be issued no later than January 31. If it hasn’t arrived by the second week in February, you should contact your employer.
  • 1099-INT- This is a summary form showing the year-end totals for interest you earned on money kept either in bank or investment accounts. It will typically be issued by the custodian of the funds, be it a bank, mutual fund, or other financial institution. If you earned under $10 in interest from any one entity, they may not issue a form, as there is no federal reporting requirement.
  • 1099-DIV– This is a summary form issued by investment account management brokerages, places like Fidelity, T. Rowe Price, or Vanguard, and shows year-end totals for dividend and investment account earnings. This form is especially important to SUBMIT IN FULL, as many accounts have capital gains activity that must be reported to the IRS.
  • 1099-B- Often included in the 1099-DIV form, but issued separately on occasion, this form shows capital gains activity within an investment account. Even if it looks like there was no activity in your account, it is always best to include this form in your tax materials.
  • 1099-R- This is another summary form showing year-end totals for distributions received from retirement accounts. They will be issued by the account custodian, which can either be a private brokerage, like Fidelity or TD Ameritrade, or through a pension manager, like TIAA-CREF or the Office of Personnel Management (OPM). Generally, anyone over the age of 72 with a deferred retirement account is required to take a mandatory minimum distribution (RMD) from their retirement account, and should receive a 1099-R form.
  • SSA-1099- This is a summary form issued by the Department of Social Security showing year-end totals of social security benefits received, any Medicare premiums paid, and any federal tax withholding. Like many important tax documents, it gets mailed out in January.
  • 1099-G- This form is for anyone who received a government payment, such as unemployment assistance, and shows year-end totals for benefits received. The forms are typically issued by a state’s division of unemployment a month after the end of the tax year in which you collected unemployment assistance. State refunds are also reported on this form, and identifies the year to which the refund applies.
  • Schedule K-1- A K-1 is a report of an individual’s income from an interest in either a partnership, trust, or corporation. These forms are always issued after the entity has filed its tax return. Some entities don’t file until well after the April 15th individual return deadline, so if you know you receive a K-1 usually, make a note that you are expecting one.
  • 1099-M- These are forms reporting income that has been generated from any number of financial streams, including rental income, prizes and awards, royalties earned in excess of $10, crop insurance proceeds, or even fishing boat proceeds. The IRS doesn’t require payers to issue 1099s if the amount paid was less than $600. Similarly, if you earn money through credit card transactions, a 1099 does not have to be issued unless the transactions exceed $5,000. Regardless, whether you receive a form or not, the IRS still requirestaxpayers to report ANY income earned. If you didn’t receive a 1099, make sure to reach out to the payer for a copy.
  • 1099-NEC- While many self-employed taxpayers in previous years had received documentation of their compensation through 1099-Ms, this year has seen the introduction of the 1099-NEC (Non-Employee Compensation) form. It shows the compensation an independent contractor, such as a consultant, or an Uber Driver, received from a payer while not technically being considered an employee. The same $600 threshold that applies to the 1099-M also applies to the 1099-NEC, as do the reporting requirements of the individual. Income reported on this form will generally be subject to self-employment tax.

EXPENSES

  • 1098- Mortgage Interest Statement- If you have a mortgage, the lending institution you are borrowing from will issue a 1098 statement showing the year-end total amount you paid in mortgage interest. Oftentimes the form will also show totals for homeowner’s insurance and real estate taxes, which can be important figures if you are self-employed and looking to take a home office deduction, or if you are using part or all of the property as a rental.
  • 1098-E- This is a loan interest form issued by student loan lenders, such as Nelnet, or the U.S. Department of Education, to borrowers. It shows the total amount you paid in student loan interest during the tax year, which may then be taken as a deduction.
  • 1098-T- This form is issued by colleges and universities to students, and shows both the yearly totals for tuition billing and scholarships. This form is necessary to qualify for the federal Education Credits.
  • 1099-Q- This form is issued when money is withdrawn from a 529 plan to pay for higher education costs. If a distribution was taken, this form, in conjunction with the 1098-T, allows us to reconcile your Education Credit amounts, as well as substantiate to the IRS that the withdrawn amounts were spent on higher education expenses.
  • Real estate tax bills- These bills are issued by the city or town in which you live. Many municipalities assess, bill, and accept payment for real estate taxes online, but we would strenuously advise keeping paper record of each one. Something that often causes confusion during tax season is the fact that real estate taxes are issued according to a fiscal year, while they are reported on your tax return according to the tax year (which is essentially the calendar year). The important thing to remember is that the real estate taxes you report on your return are those PAID IN THAT FILING YEAR, which in regards to quarterly bills means the last two quarters of the prior fiscal year, and the first two quarters of the new fiscal year.
  • Excise tax bill- Unloved cousin to the real estate taxes, excise taxes are municipal taxes imposed on cars, trailers, or boats. Because they aren’t exorbitant tax bills, they tend to be forgotten in most tax packets, but in some instances they can be an important asset in increasing the state and local tax deduction.
  • Charitable Contributions- This has become a highly-audited deduction in recent years, so it is important to know the IRS requirements for verifying both cash and non-cash contributions.
    • Cash Contributions- If you made individual contributions of $250 or more to any one charity, the IRS requires that you keep record of a written acknowledgement from the charity (cancelled checks are not enough), and we advise that you do so for audit purposes. For reporting purposes, we request written documentation of any year-end amounts donated to a charity totaling over $3,000, as the IRS requires that we report them individually from your charitable contribution totals.
    • Non-Cash Contributions- In order to file, if your year-end non-cash contribution total exceeded $500, we will need copies of all receipts. Only report donated amounts which you can substantiate, and only then for items in at least good condition. Many organizations provide a guide to valuing donated goods, but failing that, utilize any reasonable valuation method available.
  • Business Expenses- These refer to the records of any expenses self-employed taxpayers incur in relation to the operation of their businesses throughout the year. This can include things like invoices for contract labor, publication and insurance bills, license fees, and tuition for professional development classes. If you have a home office, it is necessary to track expenses like utilities, hazard insurance, cable and internet, and capital improvements made to the home, depending on if you rent or own the home you live in.
  • Rental Expenses- Much like self-employed business expenses, rental expenses are any costs incurred in operating a rental property, commercial or otherwise. This includes capital improvements, like kitchen renovations or gutter replacement, as well as mortgage interest, real estate taxes, insurance bills, repairs, and water and sewer bills.

HEALTH CARE

  • 1095-A/B/C- These are health insurance forms that transmit information to the IRS showing that you were covered by qualified health insurance throughout the tax year. Which of the three forms you receive will be dependent on the kind of insurance your employer provides.
    • If you receive insurance through the marketplace it is important to obtain the form 1095-A.
  • 1099-HC- Slightly different from the federal 1095-A form, the 1099-HC form is Massachusetts-specific. It indicates whether or not you were covered by health insurance for the full year, and is helpful for filing and proving coverage on your Massachusetts return.
  • 1099-SA- This is a form that reports any distributions you may have taken from a Health Savings Account (HSA) throughout the year. The custodial banks will issue the form to the account holder at the beginning of the year, but only if you took a distribution from the account.
  • 5498-SA- Sister-document to the 1099-SA, the 5498-SA tracks contributions made into the HSA by the account holders.

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