Your accounting professional is only as good as the information you provide. So, if you want to find all the deductions and credits you’re entitled to, it pays to come prepared when you two meet.
If you own a business, discuss with your accountant a list of documents and other information needed for thorough tax preparation. This list may start with last year’s income tax returns (if you’re a new client). You may also need copies of estimated federal and local income tax payments, and of other business taxes like payroll, sales and excise levies.
If you were an independent contractor or hired one, bring with you copies of the 1099-MISC documents. If you received 1099 income but didn’t get a statement, you are still responsible for reporting the amount and paying tax on it.
Don’t forget to keep supporting documents for your business expenses to back up any deductions you take. Depending on your firm’s legal structure, you’ll want to total employee costs such as Social Security and other payroll taxes, insurance premiums and employee benefits. Expenses incurred as a cost of doing business will range from rent or mortgage payments to the cost of goods you sell, and they may include marketing, legal and accounting costs.
If you use a tax professional to file your personal income tax returns, you should provide wage statements such as W-2 and 1099 forms, and tax statements for your investment, retirement and bank accounts.
On the expense side, some federal tax deductions were eliminated, but mortgage interest and real estate taxes up to certain limits can still reduce your taxable income. Unreimbursed healthcare costs (exceeding 7.5% of adjusted gross income) and charitable contributions are deductible if you itemize.
Whether you pay business or personal taxes, talk to your tax preparer to gather the information needed to complete your returns.
© 2019 KVLSM LLP - CERTIFIED PUBLIC ACCOUNTANTS AND ADVISORS - NEW YORK
This e-mail and any attachments are intended exclusively for the individual or entity to which it is addressed. It may be confidential or legally privileged. If you received this
message in error or are not the intended recipient, you should destroy the e-mail message and any attachments or copies, and you are prohibited from retaining,
distributing, disclosing or using any information contained herein. Please inform us of the erroneous delivery by return e-mail. Thank you for your cooperation.