How to Start the Process of Preparing Tax Returns
Male: What do I need to start the process of preparing my tax return?
Art: To begin preparing your return, you to gather all of your papers, the thing to remember is that your tax return is a non-fiction representation of your financial affairs for the prior year. Things that you need to report is income are any increments that you have in your wealth or any money that you’ve taken in, unless they’re specifically excluded by the internal revenue code. And then to accumulated documents you need regarding deductions. So the most common documents are your forms 1099, 1-0-9-9, interest that you may get from places that you have your savings accounts or your investments. If you have investments in the stock market, it would be 1099DIV, for the dividends. If you have brokerage house and you had any sales of securities or transactions, it would be 1099B. If the tax payer or the individual is owning a home, then you would have a 1098 form showing the amount of your mortgage interest and real property tax that you paid. If you have given any contributions during the year, then you would need a receipt from the charitable organization, and we’ll discuss that some more later, because the rules for substantiated charitable contributions have change. So there’s more documentation that you would need that the individual would need to have. If you file a tax return, the tax payer filed a return for the prior year, 2006, it would be a good idea to have a copy of that return in front of you when you start your preparation. But the biggest problem is that most people face is they don’t have any patience. We are part of the computer society where we like everything done in two clicks of the mouse. This is not gonna happen in two clicks of a mouse. You’re gonna have to, as an individual, to have patience. And I emphasize patience with a capital P.