Tax Preparation
Tax Preparation Takaways
- Even if you hire someone else to prepare your tax return, you'll need to do some of the advance work yourself—and the earlier you start, the better.
- Round up your receipts and check that you've received all the forms you need from employers and financial institutions.
- Last year's tax return can be a good guide for making sure you aren't missing any important information.
Choose an Accountant
If you don’t have a tax preparer yet, a good way to find one is to ask friends or an attorney you know for referrals. Be sure that the person you choose has a Preparer Tax Identification Number (PTIN) showing that they are authorized to prepare federal income tax returns.
You should also inquire about fees, which are likely to depend on the complexity of your return. Avoid using a firm that intends to take a percentage of your refund. The IRS website has tips for choosing a preparer and a link to the IRS directory of preparers, which you can search according to their credentials and location.
Schedule an Appointment
The sooner you can get your documents to a preparer like Hicks Accounting, the sooner you should be able to complete your return even if you file for an extension. If think you will get a refund, you'll get it after you file so don't put it off any longer. Don't wait too long to schedule an appointment with Hicks Accounting or you could miss out on opportunities to lower your tax bill, such as making deductible contributions to an IRA or a health savings account.
Gather Your Documents
Have all your various tax documents together that you have received by the end of Januarty from your employer or employers, as well as from banks, brokerage firms, and others with whom you do business. For each form, check that the information matches your own records.
These are some of the most common forms:
- Form W-2, if you had a job
- The various 1099 forms that report other income you received, such as dividends (1099-DIV), interest (1099-INT), and nonemployee compensation paid to independent contractors (1099-MISC). Brokers aren't required to mail Form 1099-B, which reports gains and losses on securities transactions, until January 31, so those may come a little later.
- Form 1098, reporting any mortgage interest you paid
- Form W-2G, if you had certain gambling winnings
If you do your own taxes or hire someone else to handle it, keeping good records will save you time and, in the case of a paid preparer, money. The earlier you start, the more smoothly it should go, and the sooner you'll have put the process behind you for another year. Hicks Accounting is here to help each step of the way.
