It seems like every year, tax rules change. If you only have one job, one necessary document, and everything basically spelled out for you in your W-2, you can easily file your own 1040EZ document and send it in with few worries at all. However, if you have more than one job, or had multiple jobs throughout the year, things can be a little more tricky. There are a few things you need to make sure you attach to your 1040 tax return. If it seems overwhelming, you may want to consider getting an expert to do your Denver tax return.
In general, you should keep a copy of all tax documents in the event you have made a mistake or end up being audited. These documents may include a copy of the tax return you filed, a copy of your W-2s and/or 1099s, a printed copy of any self-made spreadsheets, a copy of any supporting documents for your tax deductions, and copies of any receipts that are relevant to any deductions that you claimed. The IRS can audit you up to five years back, so keep these documents safe. Once the 5-year mark has passed for each document, make sure you
- Each W-2 you received if you had or have multiple jobs throughout the tax year needs to be attached to your tax return.
- Make sure you add the correct numbers together to represent your overall income and amount of taxes paid.
- If you claim a deduction, make absolutely sure you provide the supporting documents that prove you deserve that tax deduction (e.g. if you claim the American Opportunity Tax Credit, make sure you have the document from your university that proves the payments you made on tuition).
- Carefully read the instructions for any deductions you may be able to claim. Do not try to claim a credit you are not 100% qualified for.
- If you have a 1099 for work performed from home, you need to make sure that you calculate the self-employment taxes owed, unless you paid taxes quarterly. You must attach each 1099 as proof of income, even if you also had one or more W-2s from the same year. (Note: If your refund due from your W-2 taxes paid is greater than the tax you owe, you will still get a refund. If not, you will owe money to the IRS.)
- Remember: You will only get a 1099 for work performed as an independent contractor if you made more than $600 from that company/client. Consult a local accountant if you are unsure how to add income for which you did not receive a 1099.
- Tip: Keep an Excel spreadsheet of all the income you made as an independent contractor so you know how much income to report. If you are not sure which types of income you are required to report, consult an accountant.
- Proof of year-long health insurance coverage is now something you may need to attach to your tax return. Your employer, your health insurance provider, or the state (if you receive Medicaid or some branch of it) is required to provide you with a document stating that you were covered for each month. If you were covered by multiple mediums, you will need to attach all the documents to prove you were covered the whole year.
- If you were not covered by health insurance the whole year, you will owe a tax for each month you were not covered. Consult an accountant if you are unsure.
shred the document in a shredder. Most of these documents contain your social security number, bank account information, and other sensitive information that could result in identity theft or unauthorized charges/withdrawals.
If all of these rules seem a little overwhelming, we recommend you hire a professional accounting firm to handle your state and federal taxes. Not only can an accountant ensure you have all the necessary documents attached, they can also let you know what tax credits you can claim.
At Bloch, Rothman & Associates, LTD, we can make sure you get all the deductions and prevent delays from mistakes or missing documents. We're your local go-to firm with expertise in personal tax preparation
. Call us at 303.321.7160
Â to schedule an appointment and get a free consultation. Our tax experts will get started right away on your hassle-free road to a great refund.