Tax Tips for the New Year
One in an occasional series of articles about your taxes.
A new year means different things for different people. One thing you can be assured of is that the new year also means that income tax forms must be filed by April 15 or a day or two later whenever the date falls on a weekend.
We’ll be discussing a number of tax issues in coming weeks or months, but want to alert you to some things now that can make your tax preparation planning easier later on:
IRS forms — Visit IRS.gov to obtain, download and print out whatever forms and documents you need. Hard copies of these forms are no longer sent to homes, but you can also find what you want at many military bases, community and technical schools and at some libraries and post office branches nationwide. The IRS, however is cutting back on form availability as it seeks to encourage tax payers to prepare and file online.
Tax documents — Most of the documentation you need to file your taxes is due to you by the end of January including your payroll and dividend reports. For example, you are due to receive your 1099-DIV from your provider by Jan. 31 and the same date applies to your payroll W-2. Keep in mind that some forms can arrive much later including Form 1042-S — Foreign Person’s U.S. Source Income Subject to Withholding — which isn’t due until March 15. Visit A Guide to Information Returns for more information.
Program or professional — You’ll want to decide as soon as possible whether you’ll be using a tax preparation software program or a tax preparation professional to do your taxes. With the former, you’ll need to have access to a computer and be able to download it. TurboTax, TaxACT, Tax Cut and Tax Works are among the programs available. You may prefer to use the services of a professional. In that case, schedule your appointment soon so that you have enough time to gather your documentation and complete your tax return.
Filing options — If you purchase software, you have filing options available through that program. If a professional handles your return, this person can file on your behalf. You can also file your federal taxes for free and some of your state taxes for free through the IRS. The IRS’ free file program is available for taxpayers with an adjusted gross income of $58,000 or less. This secure filing option is also quick and accepts payments if one is due. You can also track your refund status within 72 hours of e-filing.
Stay tuned for more information in the coming weeks. Meanwhile, start sifting through your tax file for the last tax year and get ready to assemble all of your tax documents as needed.