Tax Tips
For Individuals | For Business
The key to tax preparation time is to be organized. I encourage my clients to complete the information worksheet under the forms section of this site to be sure you have all the information needed to prepare a complete tax return.
The following is a mini version of the interview I conduct with my clients at their annual meeting. I hope it will assist you to gather most of what you will need for your tax return meeting. Please keep in mind that this list is not meant to be all-inclusive. A complicated return may require additional information. Contact my office to discuss your particular reporting requirements.
1. Names & Social Security numbers of yourself, your spouse and all
..............dependent children.
2. Employees:
a. Form W-2 and your last pay stub for the year
b. Did you have any job related expenses that you have paid during the year? If you were reimbursed by your employer, do not include them. Job related expenses include, but are not limited to: mileage, tolls, parking (these cannot be for commuting to and from your job), classes required for your job, uniforms (deduct employer allowances), supplies, license fees, etc
c. If you are a teacher of kindergarten through grade 12 - keep your receipts! The first $250 of expense is an exclusion (reduces your adjusted gross income) any additional expense may be reported on schedule A as an itemized deduction.
d. Did you receive unemployment compensation during the year? It will be reported to you on Form 1099 G.
3. Bank accounts and investments:
a. All Forms 1099-INT and 1099 DIV
b. Did you sell any stock during the year? If so, you will need Form 1099 B and the purchase price of the stock as well as the date you purchased it.
c. Did you make any withdrawals from your mutual fund investments that resulted in your receiving a form 1099 B? Check to see if the mutual fund company has provided the cost basis on an additional page to support the 1099 B. If not, you should contact your broker for this important information.
d. If you are a shareholder of a Subchapter S Corporation or a partner in a Partnership you will need to provide the Form K-1 received from that business.
e. Do you own rental real estate? If so, you will need to report the rental income and expenses of each property. A list of all improvements, repairs and new appliances. Your log of mileage for collecting rent, visiting the property and making repairs (if you do not live at the property) will support deductions against rental income.
f. Did you sell rental or investment real estate during the year? - be sure to have the closing statements for the purchase of the property as well as the sale. If the property was rented, you will need to supply the depreciation schedule, unless your preparer already has this information. If the property was held for investment and never rented, be sure to have a list of all expenses paid for the property during the time you have held it. Include real estate tax, costs of maintaining the property, repairs and improvements, etc.
g. Did you make any IRA or Roth contribution during the year? Be sure to provide my office a copy of Form 5498 when it is available.
h. Did you receive income as a beneficiary of a trust or estate on Form K-1?
4. Self employed or side business owners:
a. Calculate total revenue for the year, including but not limited to income reported by customers on Form 1099.
b. Prepare a list of expenses for your business. Be sure to include your record of mileage, tolls and parking as well as a description of the vehicle used for your business. All meals and entertainment expenses should have receipts to support the purpose of the meal and should include a list of all people present.
c. Have a list of any capital assets that you may have purchased for your business during the year (i.e. computers and related equipment, equipment, machines etc.
d. Have copies of your business bank account statements available.
e. Did you invest in a SEP or SIMPLE plan during the year? Be sure to provide my office a copy of Form 6598 when it is available.
5. Retiree:
a. Form 1099-R
b. Social Security Statement Form SSA-1099
c. Did you have medical expenses paid during the year for which you were NOT reimbursed by insurance?
d. Did you pay premiums for supplemental health insurance during the year?
e. Did you make payments for Long Term Insurance? - add the amount of premiums paid during the year.
f. Calculate the number of miles you drove for medical care during the year or the cost of transportation to doctor or other providers.
6. Gambling Winners:
a. Form W-2 G.
b. Did you have had any gambling losses during the year? - They may be used to offset the winnings. Be sure to keep proof of these losses. Keep receipts, tickets and use a courtesy card at casinos. Casinos can provide a statement of winnings and losses at year end, if you request one.
7. Parents:
a. Do you have kids in college or post secondary education?
b. Are you attending college or post secondary education?
c. How much did you pay for tuition and related expenses?
d. How much did you pay in student loan interest this year?
8. Homeowners:
a. How much property tax did you pay during the year?
b. How much mortgage interest, including home equity interest did you pay during the year for your residence and second home?
c. Did you refinance your home mortgage during the year?
d. Do you have a boat loan or recreational vehicle loan? – It may be deductible.
e. Did you sell your home during the year? Be sure to have your closing statements for both the purchase and sale.
9. Supporters of charity:
a. Did you make any cash charitable donations made during the year. Make a list. Please note that the IRS will no longer allow a deduction for unsupported donations. You must have a receipt from the organization or a cancelled check. For donations in excess of $250, you must have a letter from the organization.
b. Did you make any non-cash donations? Deductions for the donation of clothing and household goods are limited to the fair market value of the items, which is substantially lower than the cost of the items when you originally purchased them. You must have a receipt from the organization stating that the items are in good used condition or better.
c. Did you donate an automobile or a boat? If so make a note of the vehicle’s VIN#, fair market value (get an appraisal from a new car dealer selling your automobile make) and have a letter from the receiving organization stating receipt of the automobile as a donation as well as a letter stating the price that the organization received upon the sale of the automobile.
d. Did you use your automobile for charitable purposes? If so, your log will support the mileage that you may be able to take a deduction for.
10. Taxes:
a. Did you receive a state or local income tax refund during the year which was reported to you on Form 1099G?
b. Did you make estimated tax payments? – When and how much?
With any luck you have made it through this list and have tucked all your information into your folder by the end of the first or second week in February (Most of the tax documents that I refer to above, are required to be sent to you by January 31). You are all ready for your tax appointment!
Now, wasn’t that easy?
Contact my office to obtain an appointment today!
As you prepare to enter a new year or are mid-way through your fiscal year, now is a good time to make sure your records are in order for tax return filing and to begin preparing your files for next year.
1. Look at your current accounting system.
Are you still using a paper check register or the one-write system?
Do you have a new (or relatively) new computer?
Do you use excel to keep track of income and expenses?
If you answered yes to any of the above questions, perhaps it is time to invest in an accounting program that will assist you in classifying expenses, make reconciling your cash accounts a snap, can create customer invoices and statements and most importantly – help you to see your bottom line with a click on the keyboard!
QuickBooks (Intuit) provides its users with a cost effective product that with the proper initial set-up (I can help you do that!) will save time and money!
See the Quick Links For Business section of this website information about various products available.
Call my office to discuss which product would provide the best value for your business.
2. Create a new or update your current filing system.
Do you maintain your records in an organized manner, including files for permanent company records, current year receipts, and current year expenses?
Would you be able to provide these records in the event of an audit?
3. Determine the best practices for your type of organization.
If your business is a corporation, do you have a complete stock book and copies of your organization papers?
If your business is an S-Corporation, do you know where the confirmation of the election is?
Did you file your annual meeting minutes? (need a space after this line)
Is your compensation reasonable? This is an important issue for both C and S Corporations for different reasons. If your business is a partnership, can you find your partnership agreement? (all wording following should be deleted)
If your business is a partnership, can you find your partnership agreement?
If your business is a Limited Liability Company, how are you taxed?
4. Be sure you are compliant with tax reporting requirements.
Do you properly classify your employees and independent contractors?
Do you issue Form 1099-MISC to all required payees to whom you have paid more than $600 during the year?
Are you filing quarterly and annual payroll reports and making depository payments on a timely basis?
Do you collect sales tax from customers in all applicable jurisdictions and remit sales tax on a timely basis?
Are you making your estimated payments on a timely basis to avoid interest and penalties?
The schedule for estimated payments for a calendar year taxpayer is:
Quarter 1 March 15
April 15 (for individuals)
Quarter 2 June 15
Quarter 3 September 15
Quarter 4 December 15
January 15 (for individuals)
5. Be sure you are compliant with tax laws of all states that apply
..............to your business.
Are you aware that rules requiring filings for sales tax and income tax vary in and among the states?
6. Feel confident that your tax returns are being filed correctly.
If you are unsure about the answers to these questions or have questions of your own Contact my office for an appointment.
Quick Links
6 East Maitland Lane
New Castle, PA 16105
Phone - (724) 598-0400
Fax - (724) 598-0401
Email Me
Map & Directions
