If you made less than $12,000 in 2018, you do not need to file a tax return. However, you may want to file even if you are not required to. In today’s ultimate guide to filing your taxes, we will discuss what you need to file your taxes, why you need to file, and more.
What do I Need to File my Taxes?
To file your taxes, even if you get assistance from a professional, you need to be organized. To make the process as simple as possible, before you start to file, gather personal information, information on your dependents, and documentation on other sources of taxable income.
Gathering your personal information is the simplest part of the tax return filing process. All you need is your tax ID number or social security number and your spouse’s tax ID or social security number and full name. Many people already know this information without having to gather any documents.
Here is all the information you need to claim a dependent:
- Social security or tax ID numbers and dates of birth
- If applicable, childcare records including the tax ID number of the provider
- Income of any other adults in your home
- Form 8332, if applicable, showing the custodial parent of the child is releasing their right to you to claim a child, if you are not the custodial parent
Sources of Income
This is the second hardest part of preparing to file your taxes. However, it is extremely straightforward because all the necessary documentation is mailed or e-mailed to you. If you are employed, you will receive a Form W-2 for each company you worked for in the calendar year. If you were unemployed for a period, you will receive a 1099-G. If you were self-employed, you need:
- Home office information, if applicable
- Form 1040-ES (record of estimated tax payments made)
- Records of all expenses – receipts, credit card statements, or check registers
- Information on any business assets you used for the purposes of depreciation
- Form 1099 and Schedule K-1 to verify income not reported on 1099s
Why do I Need to File Taxes?
At a basic level, you need to file a tax return because the chances are good that your payroll withholding is not perfect. Based on how you fill out your W-4 when you start a new job, you may end up overpaying or underpaying your employment taxes throughout the year.
Whether you owe taxes or not, it is important to file a tax return. If you owe the IRS money and don’t file, you face penalties and interest. You can even be fined for not filing. On the other hand, if you overpaid your employment taxes throughout the year, you are entitled to a refund. If you do not file your tax return, you are leaving money on the table that belongs to you.
How do You File a Tax Return?
There are three ways to file a tax return. First, you can go to your local library or visit the IRS’s website and get a Form 1040. Mail this form to the IRS along with any other forms you have to file and any payment you owe the IRS. If you are owed a refund, you can choose to have a paper check mailed to you or provide bank account information and receive a direct deposit.
The second option is using a website or tax software program but these services cost you money, are overly complicated, and lack the human element. The third option is to get a professional tax preparer to file your tax return for you. This is the best option of the three because your tax accountant has the knowledge and experience to minimize your tax liability or maximize your refund.
Get Help Filing Your Taxes Today
Filing your tax return is not fun for most people but it is important for everyone. For more information on if you should file a tax return, or for help to navigate the murky waters of the Internal Revenue Code, contact us at Geaux Tax Resolution today.