When you are in the office on a regular basis and have a complicated tax situation, there’s no time to waste with paperwork. Organizing records can often feel daunting and tedious, but it doesn’t have to be.
In this guide, we find out What Paperwork Do I Need For Taxes, what documents do i need to file taxes as a homeowner, how to file taxes, and 7 documents you need when applying for a home loan.
-A calendar for noting important dates throughout the year (like when you bought something or sold something)
-A mileage log for tracking your driving miles for business purposes (if you use this for personal driving as well, be sure to note that)
-A copy of last year’s tax return
-W2s from employers and 1099s from other sources where money was earned during the year
-Receipts for all charitable donations made during the year
What Paperwork Do I Need For Taxes
Tax time is a stressful time of year, but it doesn’t have to be! Being organized and having the right paperwork can make your life so much easier. From mileage logs to charitable donation receipts, here are some things you should keep on hand before you file taxes:
Taxpayer identification number.
The next form you will need is the 1040, or Individual Income Tax Return. This form is used to file your taxes and report how much money you earned during the tax year. The taxpayer identification number is a social security number that can be obtained by completing Form SS-5 and filing it at your local Social Security Administration office or online. Anyone who has ever been employed in the United States should already have one of these numbers, but if you are currently living overseas or have never worked for an employer outside of the home, then this process may be more difficult for you than others. However, there are certain circumstances when individuals who have not previously worked in America can still obtain one:
- If your spouse (or common law partner) has a valid Social Security Number (SSN), then so should you! The rules on this vary from state-to-state; however, most jurisdictions allow couples working together as business partners to both receive their own SSNs based on employment income reported by their spouse/partner on his/her Form W-2 tax return submitted each year through April 15th each springtime.* If neither spouse has worked before; OR if both spouses have worked but none of them obtained SSNs during those jobs because they were not required laborers under U.”
W-2 form.
The W-2 form is the one that employers give you at the end of the year. If you’re an employee, this will show how much money your employer paid to you during the year and how much of it was withheld for taxes. The W-2 form is important to include with your tax return because it helps determine what credits and deductions are available to you.
If you’re self-employed, there’s a different version of this form called the 1099 that shows income from freelancers or contractors—and again, it helps determine which tax deductions apply in those situations as well. If you have been paid both as an employee and as a contractor, then both forms might be necessary for filing your taxes (you’ll need one W-2 for each type of work).
Form 1099.
Form 1099-MISC is a tax form used to report miscellaneous income. It’s used for reporting income from independent contractors, but can also be used for other purposes. For example, if you sell property through an online platform such as Craigslist, eBay or Amazon, you’ll receive a 1099-MISC from the company that processes your payment—and it’s up to you to report this information on your taxes.
If you have any questions about what paperwork you need for taxes or how much money you’ll owe at tax time, it’s best to consult with your accountant or financial advisor before filing so they can advise you on the best course of action based on your situation.
Child care information.
If you’re claiming someone as a dependent, you’ll need their financial information as well as your own. That includes bank account numbers and investment account information so you can find out how much they earned and spent that year. If you’re married and filing jointly, your spouse will also have to fill out the Form 1040 with you.
If that person was home all year long—and not caring for another dependent or qualifying relative—it’s possible they were eligible for the child care credit or deduction. To claim either of these, be sure to have documentation showing how much it cost to pay someone else to watch your kids so that one of them could go back to work or school full-time during the year. The IRS considers babysitting costs eligible expenses when calculating this credit but does not allow daycare center expenses (in other words: don’t try claiming money spent at Gymboree!), so make sure any receipts say something about child care before submitting them with your tax return!
If there is no documentation of this expense on hand, consider using TurboTax’s Child Care Expense Calculator tool at wwwturbotaxcom/CCECalculator
Medical expenses.
Medical expenses.
If you itemize your taxes, it’s a good idea to keep receipts for medical expenses. They’re tax-deductible if they’re more than 10% of your adjusted gross income (AGI) or 7.5% if you’re 65 or older (and are also subject to a floor).
The IRS has a comprehensive list of what counts as deductible medical expenses—anything from doctor visits to vision care and prescription drugs fits the bill—but here are some things that often get overlooked:
- Transportation costs like gas, parking fees, tolls and public transportation fare to get you to the appointments in question (if those are not already reimbursed by insurance).
- Costs related specifically to getting medical care like travel costs for non-emergency treatment out of town (if there aren’t any local options available) and mileage for making house calls when necessary., if not already reimbursed by
Mileage log.
Mileage log. If you want to take the standard mileage deduction, you must keep a record of your business miles and their purpose. The IRS wants to make sure that the vehicle is used for business purposes; if it isn’t, they won’t allow any deduction at all.
It’s not hard to do this if you use a mileage tracker app (or an old-school spreadsheet). Just record each trip as soon as possible after it happens and write down the date, location and purpose for each trip. It’s best to start keeping records before April 1st so that you have time to check them against other documentation from 2018 tax season when filing next year.
Charitable donation receipts.
If you donated more than $250 to any organization, make sure to hang onto your donation receipt for at least 5 years. If you donate less than $250 and don’t get a receipt, that’s fine—you don’t need one.
You also want to make sure that the organization is exempt from federal income tax, such as churches or nonprofit organizations like the Red Cross or United Way. But if they’re not an exempt organization? You should still be able to claim your donation if it was made directly through them (for example, by texting in the amount of your gift). Just keep track of what you gave them so you know how much credit to claim at tax time!
Property tax receipts.
Your property tax receipts are important. They’re one of the most common documents that people forget when they try to file their taxes, especially if they didn’t receive an official copy from their town or city. If you don’t have them, your deduction will be denied and you won’t get a refund for your purchase. You can usually find them online if you know where to look—the IRS generally only requires that the property tax payments be made in full and on time during the previous year (or two years if married).
The best way to find these receipts is by checking with your local government: many municipalities will send these out electronically through email or via snail mail, but others may require someone with authority like an accountant or financial advisor access before they can be shared with him/her.”
Mortgage interest statements.
Mortgage interest statements are required documentation if you plan to itemize deductions. If your mortgage is on a home, then mortgage interest is not deductible. However, if your mortgage is on another residence such as a second home or rental property, it may be possible for you to claim the interest paid as a deduction from income.
The IRS has several pages dedicated to providing information about what kinds of expenditures can be deducted from taxes and how much they will reduce your overall taxable income. They also have an online calculator that can help determine whether certain expenses are eligible for deductions or credits when filing taxes next year!
Now that you’ve got a handle on what paperwork is required, let’s talk about how long it takes to get your tax refund.
The IRS estimates that the average tax refund is $2,865. If you’re looking at an even bigger check, however, there are several factors that can increase your refund amount. These include:
- Filing as a head of household and claiming dependents (for example, if your child has no other parent with whom he or she has lived for more than six months)
- Being eligible for Earned Income Credit or Additional Child Tax Credit
- Having high medical expenses in 2017 (more than 7.5% of adjusted gross income)
The best way to file taxes electronically depends on whether you use a professional tax preparer or self-prepare your return online or by paper mail. In general though, electronic filing is better because it saves time and money while reducing errors in processing by eliminating human error when entering data into computers; when sending emails back and forth regarding questions about specific forms being prepared; etcetera…
what documents do i need to file taxes as a homeowner
Buying gives a great feeling of starting a new chapter in life, of having “arrived.” But make no mistake, owning a home is a huge financial responsibility, probably the biggest you’ll ever have. Besides the mortgage payments, there’s insurance, property taxes, maintenance costs, the list goes on.
The federal government knows just how big a deal owning a home is, so the tax law provides several ways for your home ownership costs to cut your taxes. Certain expenses are deductible, provided you itemize deductions. Let’s look at some of these deductions.
Deducting Mortgage Interest
If you’re making monthly mortgage payments for your home, you may be able to deduct the interest on your payments. You may qualify for the interest deduction on up to two qualifying homes. To be eligible to deduct the interest:
Note: Beginning with 2018 returns, there are now different maximum loan amounts rules, depending on the loan date:
You should receive Form 1098 or a similar document from your mortgage lender stating how much interest you paid for the year. So when you do your taxes on 1040.com, just fill out the Form 1098 screen. If you didn’t get a Form 1098, instead fill out the Deductible Mortgage Interest screen. Just fill out one of the screens for the same loan, though.
Deducting Home Equity Loan Interest
You may also be able to deduct interest paid on a home equity loan, provided the loan is to buy, build or substantially improve your home. You may deduct the interest if the loan does not exceed $100,000 (if married filing separately, the maximum is $50,000).
Borrowing against your home for any other purpose, such as repaying credit card and various other debts, is no longer deductible.
Deducting Real Estate Taxes
Note: Real estate tax is also deductible, but beginning with 2018 returns, the total of all state and local taxes is limited to $10,000 ($5,000 if married filing separately. Included in this total are state and local income taxes, real property taxes, and personal property taxes.
The tax for your home is often included in your mortgage payment. Your mortgage holder will hold the tax amount for you until it’s time to pay the tax, and will make the payment for you. If this is the case, the mortgage holder will send you a statement showing how much real estate tax was paid for your property.
As with home mortgage interest, enter the real estate tax on our Form 1098 screen (or the Interest You Paid screen if you didn’t receive a Form 1098).
Private Mortgage Insurance
Private mortgage insurance (PMI) premiums are deductible as part of the mortgage interest deduction. The deduction begins to phase out at $100,000 in AGI, and phases out completely once AGI reaches $109.000. If married filing separately, the phaseout begins at $50,000 and phases out completely at $54,500.
The PMI deduction had expired at the end of 2017, but has been extended through the 2020 tax year.
Deducting Points
A point refers to certain charges paid or treated as paid by you to get a mortgage. Your mortgage documents should list the charges that are included.
When deducting points, you have a choice: you can either deduct them all at once, for the tax year paid them, or you can stretch them out, deducting a percentage each year you have the mortgage.
how to file taxes
Tax filing can be daunting. So if you’re wondering how to file taxes online or on paper in 2022 for 2021, here’s a cheat sheet on how to do your taxes and how to make tax filing easier.
1. Do you even have to file taxes? (Yes, probably.)
Whether you have to file a tax return this year depends on your income, tax filing status, age and other factors. It also depends on whether someone else can claim you as a tax dependent.
Even if you don’t have to file taxes, you might want to do it anyway: You might qualify for a tax break that could generate a refund. So give tax filing some serious consideration if:
When can I start filing taxes for 2022?
The IRS set the start of tax season as Monday, January 24, 2022.
Do you file 2021 taxes in 2022?
Yes. The purpose of the 2022 tax-filing season is to file taxes for the 2021 tax year.
2. Choose how to file taxes
There are three main ways to file taxes: fill out IRS Form 1040 or Form 1040-SR by hand and mail it (not recommended), use tax software and file taxes online, or hire a human tax preparer to do the work of tax filing.
a. File taxes online with tax software
If you’ve used tax software in the past, you already know how to prepare and file taxes online. Many major tax software providers offer access to human preparers, too.
TurboTax, H&R Block, TaxAct and TaxSlayer, for example, all offer software packages or support options that come with on-demand, on-screen or online access to human tax pros who can answer questions, review your return and even file taxes online for you.
The IRS Free File program can get you free online tax preparation software from several tax-prep companies, including major brands. You must have $73,000 or less of adjusted gross income to qualify.
b. Hire and work with a tax preparer
While it’s never been easier to do your own taxes using software, as your financial life gets more complex you might wonder if you’re missing something and should get someone to prepare and help file your taxes. If you have a business or a healthy side gig, or you just want help understanding all of the forms, you might seek out a professional’s guidance.
If you don’t want to meet in person with a tax preparer, there’s a way to file taxes without leaving the house. A secure portal lets you share documents electronically with a tax preparer. Typically, the preparer will email you a link to the portal, you’ll set up a password and then you can upload pictures or PDFs of your tax documents.
3. Understand how your taxes are determined
The government decides how much tax you owe by dividing your taxable income into chunks — also known as tax brackets — and each chunk gets taxed at the corresponding tax rate. The beauty of this is that no matter which bracket you’re in, you won’t pay that tax rate on your entire income.
The progressive tax system in the United States means that people with higher taxable incomes are subject to higher federal income tax rates, and people with lower taxable incomes are subject to lower federal income tax rates.
7 documents you need when applying for a home loan
If you’re applying for a mortgage, it’s a good idea to start prepping your financial documents.
Lenders will request paperwork for your mortgage application that proves things like how much money you make and your debts. The exact forms you need for a home loan depend on your situation. For example, someone who is self-employed will likely have to provide different forms than someone who is employed by a company.
Although the exact forms might vary, Todd Huettner, owner of Huettner Capital, a residential and commercial real estate lender, says a lender can get a good sense of your likelihood of being approved by checking out your recent pay stubs, bank statements, W-2 forms and tax returns.
Huettner says that with these documents, he’s able to make a good assessment of the borrower. “These documents allow me to tell (borrowers) what they can and cannot do with a very high level of certainty,” he says.
Depending on your unique financial situation, here are seven mortgage documents you might need when applying for a home loan.
1. Tax returns
Mortgage lenders want to get the full story of your financial situation. You’ll probably need to sign a Form 4506-T, which allows the lender to request a copy of your tax returns from the IRS.
Lenders generally want to see one to two years’ worth of tax returns. This is to make sure your annual income is consistent with your reported earnings through pay stubs and there aren’t huge fluctuations from year to year.
2. Pay stubs, W-2s or other proof of income
Lenders may ask to see your pay stubs from the past month or so. Your tax returns help give them a clear idea of your overall financial health, while pay stubs help them gauge your current earnings. If you’re self-employed or have other sources of income (such as child support), you may need to show your lender proof through 1099 forms, direct deposits or other means.
3. Bank statements and other assets
When assessing your risk profile, lenders may want to look at your bank statements and other assets. This can include your investment assets as well as your insurance, such as life insurance.
Lenders typically request these documents to make sure you have several months’ worth of reserve mortgage payments in your account in case of an emergency. They also check to see that your down payment has been in your account for at least a few months and did not just show up overnight.
4. Credit history
In order to assess you as a borrower, lenders often pull your credit report — with your verbal or written permission.
According to Bruce Ailion, a real estate agent in Atlanta, you may need to explain any blemishes on your credit report. Blemishes might include a previous short sale or a foreclosure.
“You should be prepared to write a statement that explains negative items on your credit report,” Ailion says. “This helps a lender evaluate what kind of risk you are. Lenders may look at one-time unavoidable circumstances differently from habitual delinquency.”
5. Gift letters
Your friends and family might help you buy a house by giving you money. If that’s the case, you’ll need to provide a written confirmation the money is indeed a gift and not a loan. The documentation should list their relationship to you as well as the amount of the gift.
6. Photo ID
You’ll likely need to provide a photo ID, such as a driver’s license. This is simply to prove you are who you’re claiming to be.
7. Renting history
For buyers who don’t already own a home, many lenders will request proof that you can pay on time. They may ask for a year’s worth of canceled rent checks (check that your landlord has cashed). Or, they might ask your landlord to provide documentation showing that you paid your rent on time. Your renting history is especially important if you don’t have an extensive credit history.