A practical guide to organizing your documents and avoiding last‑minute stress.
Well‑organized tax records can make the tax return preparation process significantly easier. As you begin gathering your information for the upcoming filing season, here are key areas to focus on to help facilitate a smooth and accurate return.
Annual Tax Forms
Most custodians mail Form 1099s by mid‑February, though corrected versions may be issued later. These forms include important details such as dividends, interest, and gain/loss information for securities sold during the year. Visit the Modera Tax Center for the most up-to-date information on custodian schedules as well as other helpful and timely guidance.
If you misplace a form, you can typically access it online through your custodian’s website once it has been published.
Foreign Bank Accounts and Virtual Currency
The IRS has specific regulations for reporting foreign financial assets and virtual currency. Please disclose any holdings of these types of assets.
Other Sources of Income
In addition to investment or retirement income, you may receive:
- Form W‑2 for wages
- Schedule K‑1 for passthrough entities (often available mid‑March or later; some arrive as late as September)
- Other income such as alimony received, which may need to be calculated from bank statements
- Social Security income (Form SSA-1099)
- Interest income (Form 1099-INT)
For publicly traded partnerships, you can check https://www.taxpackagesupport.com/ for K‑1 availability. Ensure you have a K‑1 for every passthrough entity you own before filing.
Cost Basis on Securities Sold
Most 1099s include cost basis information. If any sales show “basis not reported,” you’ll need to provide those details separately.
Adjustments to Income
These are some possible deductions that can potentially reduce your taxable income:
- Deductible IRA contributions
- Health Savings Account (HSA) contributions
- SEP, SIMPLE, or other self‑employed retirement plan contributions
- Self‑employed health insurance payments
Gather any documentation related to these items.
Deductible Expenses
If you itemize deductions, collect documents supporting amounts reported on Schedule A, such as:
- Mortgage interest (Form 1098)
- Investment interest expense
- Real estate and personal property taxes
- Medical expenses
- Charitable contributions
Tax Credits
Tax credits directly reduce your tax bill. You may be eligible for credits such as:
- American Opportunity Credit (education)
- Child Tax Credit
- Earned Income Tax Credit
- Dependent Care Credit
If you receive health insurance through the Marketplace, include Form 1095‑A.
For updates on credits and deductions, refer to the IRS website.
Basis of Property
Now is a good time to review and update the cost basis of:
- Investment property
- Your personal residence
Improvements made during the year may increase basis, so keep receipts and records. Retain documentation for at least seven years after the property or investment is sold.
Taxes Paid
Federal and state withholding amounts appear on Forms W‑2 and 1099.
If you made quarterly estimated tax payments, double‑check:
- Amounts
- Dates
- The tax year each payment was applied to
Incorrect reporting can lead to notices from tax authorities.
Life Changes
Update your tax preparer on any significant changes from the past year, such as:
- Change of address
- Change of occupation
- New household members
- Marriage, divorce, or other family changes
These details can affect your filing status and eligibility for certain credits.
A Smoother Tax Season Starts with Early Organization
Everyone’s tax situation is unique. The guidance above offers a strong starting point for building a document‑gathering process tailored to your circumstances. By organizing now, you may find that tax season feels far more manageable, and maybe even a little less dreaded.
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