2014-01-30 / Lifestyles

Tips for taxpayers: Meet preparers with this list

What to bring before starting your taxes

BRIGHTON – It’s time for the annual ritual of settling up with the tax man – the IRS. For the estimated 60 percent of the American taxpayers who turn taxes over to a paid preparer it’s time to get started.

Here’s a list of some items to make the process easier:

Last year’s tax return. Lots of important information can be found here, such as Social Security numbers, dependent information and credits and deductions previously taken. Preparers are off to a running start when this is supplied.

W-2 form(s). This important document lets preparers know how much you made and how much has been withheld from your paycheck for state and federal taxes. Your employer has until Jan. 31 to issue W-2s, and if it’s still not in your hands by Feb. 14, you can turn to the IRS for assistance. They will be standing by to assist you at (800) 829-1040 on that date and beyond. Before you make the call, be sure you have the following information at the ready: your Social Security number, dates of employment and your employer’s name, address and phone number. The IRS will not only contact your employer, but it will also send you a Form 4852 (a substitute Form W-2) to fill out in case you don’t receive the form W-2 in time to make the tax deadline.

1099 Forms. These forms report a multitude of items not covered by the W-2, including “additional income” (1099- MISC), earned interest (1099- INT), cancellation of debt (1099- C), dividends received (1099- DIV) and proceeds from broker transactions (1099-B). The IRS will sometimes grant an extension on the Feb. 15 deadline to issue 1099s, so be sure to watch for any such announcements this year. If you received a state income tax refund in 2013, be sure to look for the 1099 from Michigan Treasury.

1098 Forms. No homeowner wants to miss out on that mortgage interest deduction, which has been known to make a real difference in whether you owe or are getting a refund. Also in the 1098 family is the reporting of student loan interest paid and charitable contributions.

K-1 Forms. These show income from a partnership, small business or trust.

Some other things to think about: If you collected unemployment benefits at any time during the year, that money is generally taxable and you will need to bring a form 1099-G. For state filing, you’ll want to remember to include any personal property tax paid – for example, on your automobile. Did you collect Social Security, rent a property, receive self-employment income or pay alimony? Cancelled checks and receipts can help to document expenses you wish to claim, such as those related to a home office. Job search expenses, moving expenses, college expenses and childcare can all be deductable under certain circumstances. Medical expenses might be deductible, but the bar is high.

While this list is not comprehensive, help. When choosing a preparer, keep in mind that the IRS now requires all paid preparers to register and have a Tax Preparer Identification Number, and, if a preparer does not have one, he or she is practicing outside the law.

Enrolled agents certified public accountants and attorneys can represent taxpayers before the IRS in all matters, including audits, collection and appeals. Because they are federally licensed, only enrolled agents, have unlimited representation rights in 50 states – locate one in your area on the “Find an EA” directory at www.naea.org.

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