Getting Ready for Tax Time

It’s almost March so it’s time to start preparing for filing your taxes. Whether you’re filing on your own, using a software provider like TurboTax or TaxAct, or working with a qualified tax preparer you’ll need to have your tax documents for 2017 ready to go.

We recommend setting aside a folder every year to put these documents in as you receive them in the mail. It’s going to be hard to remember where you put that 1099-INT you got in January by the middle of March. As far as knowing what to look for, your 2016 return is a good place to start since you’ll likely need most of the same documents again for 2017. But don’t limit yourself to just last year’s return; consider any changes in your life, financial or otherwise. Here’s a partial list (with links to the IRS pages about the various forms) to get you started:

Form W-2 is the document you’ll receive from your employer with your annual wage and withholding information.

1099 forms show income not covered by a W-2. 1099-C shows debt cancellations, 1099-DIV reports dividends and other distributions from financial institutions, 1099-INT reports interest, 1099-MISC for income you may have received as in independent contractor.

1098 forms report payments or contributions you’ve made that may be tax-deductible. Form 1098 reports mortgage interest and other items like mortgage insurance or mortgage company paid property taxes that may be deductible. You’ll receive a 1098-C if you donated a car to a charitable organization, a 1098-T for tuition payments, and a 1098-E for interest paid on student loans.

1095 forms deal with health care coverage and payments. Form 1095-A is sent to individuals who enrolled themselves or family members through the federally-facilitated Healthcare.gov or one of the state-based marketplaces. You won’t receive this form if you didn’t purchase health insurance through a marketplace.

You’ll also want to gather receipts dealing with property taxes, medical expenses, charitable contributions, and any job or investment related expenses you think may be deductible. For most people the standard deduction ($6,350 for individuals, $12,700 if married filing jointly in 2017) is simpler than itemizing but this is the information you’ll need if you want to consider itemizing deductions this year.