Insight

As tax season approaches, I wanted to share some valuable tips to help you navigate the filing process with ease and confidence. Whether you’re a seasoned taxpayer or filing for the first time, these suggestions can make a significant difference in streamlining your experience and potentially maximizing your refund or minimizing your tax liability. 

• Gather Income Documents  

This is a rather obvious one, but it can help speed up the tax filing process. Below is a list of some of the documents you should gather before filing.  Most of these documents should be mailed to you early in the year.  

Employed 

• Forms W-2 

Unemployed 

• Unemployment (1099-G) 

Self-Employed 

• Forms 1099, Schedules K-1, income records to verify amounts not reported on 1099-MISC or 1099-NEC 
• Records of all expenses — check registers or credit card statements, and receipts 
• Business-use asset information (cost, date placed in service, etc.) for depreciation 
• Office in home information, if applicable 
• Record of estimated tax payments made (Form 1040–ES) 

Rental Income 

• Records of income and expenses 
• Rental asset information (cost, date placed in service, etc.) for depreciation 
• Record of estimated tax payments made (Form 1040–ES) 

Retirement Income 

• Pension/IRA/annuity income (1099-R) 
• Traditional IRA basis (i.e., amounts you contributed to the IRA that were already taxed) 

Social security/RRB income:  

• SSA-1099, RRB-1099 

Savings & Investments or Dividends 

• Interest, dividend income (1099-INT, 1099-OID, 1099-DIV) 
• Income from sales of stock or other property (1099-B, 1099-S) 

• Dates of acquisition and records of your cost or other basis in property you sold (if basis is not reported on 1099-B) 
• Health Savings Account and long-term care reimbursements (1099-SA or 1099-LTC) 
• Expenses related to your investments 
• Record of estimated tax payments made (Form 1040–ES) 
• Transactions involving cryptocurrency (Virtual currency) 

Other Income & Losses 

• Payment Card and Third Party Network Transactions – 1099-K 
• Gambling income (W-2G or records showing income, as well as expense records) 
• Jury duty records 
• Hobby income and expenses
• Prizes and awards 

• Trust income 
• Royalty Income 1099–MISC 
• Any other 1099s received 
• Record of alimony paid/received with ex-spouse’s name and SSN 
• State tax refund 

Gather Documents for Deductions  

The types of deductions you can take depend a lot on your life situation. It’s likely you won’t need all of the documents listed below for your taxes. 

• Home and Vehicle Ownership 
• Forms 1098 or other mortgage interest statements 
• Real estate and personal property tax records 
• Receipts for energy-saving home improvements (e.g., solar panels, solar water heater) 
• Electric vehicle information 
• All other 1098 series forms 

Charitable Donations 

• Cash amounts donated to houses of worship, schools, other charitable organizations 
• Records of non-cash charitable donations 
• Amounts of miles driven for charitable or medical purposes 

Medical Expenses 

• Amounts paid for healthcare, insurance, and to doctors, dentists, and hospitals 
• Amounts paid for qualified insurance premiums if paid outside of the Marketplace or an employer provided plan 

Health Insurance 

• Form 1095-A if you enrolled in an insurance plan through the Marketplace (Exchange) 

Childcare Expenses 

• Fees paid to a licensed day care center or family day care for care of an infant or preschooler 
• Amounts paid to a baby-sitter or provider care of your child under age 13 while you work 
• Expenses paid through a dependent care flexible spending account at work 

Educational Expenses 

• Forms 1098-T from educational institutions 
• Receipts that itemize qualified educational expenses 
• Records of any scholarships or fellowships you received 
• Form 1098-E if you paid student loan interest 

K-12 Educator Expenses 

• Receipts for classroom expenses (for educators in grades K-12) 

State and Local Taxes 

• Amount of state and local income or sales tax paid (other than wage withholding) 
• Invoice showing amount of vehicle sales tax paid and / or personal property tax on vehicles 

Retirement & Other Savings 

• Form 5498-SA showing HSA contributions 
• Form 5498 showing IRA contributions 
• All other 5498 series forms (5498-QA, 5498-ESA) 

Federally Declared Disaster 

• City/county you lived/worked/had property in 
• Records to support property losses (appraisal, clean-up costs, etc.) 
• Records of rebuilding/repair costs 
• Insurance reimbursements/claims to be paid 
• FEMA assistance information 
• Check the FEMA website to see if your county has been declared a federal disaster are 

• Make IRA Contributions  

If you did not make any IRA contributions in the previous year and are eligible then you have until April 15th of this year to do so. Talk to your tax preparer to see if it makes sense for you.  

• File an Extension if needed 

If you are not ready to file in April, you can file an extension which will give you until October of the same year. However, you still need to pay what you think you owe at tax time and can reconcile in October when you do file.  

Be sure to talk to your tax preparer before filing an extension. 

• Consider Tax Planning  

Once you have filed your taxes now is a good time to review them and do some tax planning. At Blue Bell Wealth Management we offer tax planning to all of our clients.  

After sending in your tax return, we look at the big picture an evaluating things like: 

• Back-Door and Roth Conversions  
• HSA contributions 
• Charitable giving  
• Employee stock options  

Effective tax plan ensures you pay the taxes you owe at the lowest rate possible across your entire life.