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The Advanced Checklist for Form 1040: Effortless Accuracy

Checklist for Form 1040

Taxpayer’s Checklist for Form 1040

When you are preparing your taxes, whether you do it yourself or with the assistance of a tax professional online or in person, having the necessary paperwork available when you do so can help reduce the number of errors that occur and possibly reduce the amount of tax that you are required to pay.

When it comes to preparing your Form 1040, which is the standard tax return form for individuals in the United States, this blog post will serve as your one-stop guide to the essential paperwork that you will need by providing a checklist for Form 1040.

What is Form 1040?

Form 1040 is the U.S. form for filing an individual income tax return. It is the prominent form individuals use to send their annual income tax returns to the IRS. The form asks for information about your income, lets you claim credits and deductions, and figures out how much tax you owe or how much you should get back.

To put it another way, it provides the government with information regarding the amount of money that you have earned as well as the amount of tax that you are required to pay (or the amount of refund that you are eligible to receive on your taxes!). If your income is greater than the income threshold limit, you will be required to submit a Form 1040 usually.

Documents and Information Required for FORM 1040

Your Personal Information

  • Last Year’s Return: Include a copy of your previous year’s return to speed up the filing Form 1040.
  • Social Security Numbers: Required for all individuals listed on your return, including yourself, spouse, and dependents.
  • Bank Information: Gather account and routing numbers for electronic refund deposit.
  • Identification: Verification requires a driver’s license, passport, or state ID card.

Documents to Support Income Reported on FORM 1040

  • W-2 Forms: W-2 form will be provided to you by each employer if you are a salaried employee. This form will detail your wages as well as the taxes that are withheld from them.
  • 1099 Forms: come in different types to show different kinds of income:
    • Form 1099-DIV: To report dividend income.
    • Form 1099-INT & 1099-OID: To report interest income earned on savings accounts or investments.
    • Form 1099-K: To report income from merchant card and third-party network payments.
    • Form 1099-MISC: To report miscellaneous income like freelance work or side hustles.
    • Form 1099-NEC: To report income from self-employment.
    • Form 1099-R: To report distributions from retirement plans like IRAs or 401(k)s.
    • Form 1099-S: To report proceeds from the sale of a home or real estate.
    • Form 1099-B: To record transactions involving capital gains from the sale of stocks.
    • Form 1099-SA: To disclose information about how Health Savings Accounts (HSAs) and Medical Savings Accounts (MSAs) are paid out.
    • Form 1099-G: To reports unemployment compensation received.
    • Form SSA & Form RRB: For disclosure if details regarding Social Security and railroad retirement benefits.
  • Schedule K-1s: If you are a participant in a partnership, S corporation, estate, or trust, you will be provided with a Schedule K-1 that details your portion of the income generated by the entity.
  • Business Income & Expenses: When you are self-employed (Schedule C) or own rental properties (Schedule E), you must maintain comprehensive records of both your income and expenses. It’s advisable to have Accounting for all receipts and payments.
  • Letter 6419 as Additional Income Documents: Reconciles advance child tax credit payments.

Documents Required to claim Deductions and Expenses

Option to choose between standard deductions and itemized deductions.

Either you can itemize your deductions, which involves listing each deduction separately, or you can take the standard deduction, which is a predetermined amount that is determined by your filing status.

If you decide to take Itemize Deductions, following documentation are required:

    • Medical Expenses (Bills for Medical Expenses)
    • Vehicle Taxes
    • Charitable Donations (Donation Receipts)
    • Mortgage Interest (Form 1098)
    • Real Estate Taxes (Tax Bill or Payment Receipts)
    • Sales/State Taxes (Tax Bill or Payment Receipts)
    • Casualty Losses (Available only in case of federally declared disaster areas)

Even without Itemized Deductions, you can still claim some deductions, including:

    • Student Loan Interest (Form 1098-E)
    • Education Tuition (Form 1098-T)
    • Estimated Tax Payments (Form 1040-ES)
    • Self-Employed Health Insurance Premiums
    • Child Care Expenses (Caregiver’s Details)

Considerations while filing your FORM 1040:

The following two points will guarantee the accuracy of FORM 1040 and assist you in the IRS Audit, even though you have all the information and documentation needed to file FORM 1040.

  • Being accurate is very important: Check all of your Social Security Numbers, Bank Account Information, and Income & Deductions Amounts Twice. Even small mistakes can cause delays or mean you must file amended returns.
  • Important to keep records: Keep those receipts for a little while longer! Keep those receipts for a little while longer! After filing your return, the IRS advises that you preserve your tax records for at least three years in case of audits or inquiries.

Having this list on hand and gathering the necessary papers throughout the year can make tax time less stressful.  Don’t forget that a little planning can cut down on mistakes, possibly lower your tax bill, and make sure that filing goes smoothly. If your tax situation is complicated, don’t be afraid to talk to a tax expert for personalized help. You can easily handle tax season if you have the right information and are well-organized.

How can BusAcTa Advisors Help with Your Taxes?

We at BusAcTa Advisors help businesses and CPAs make their Tax Preparation processes easier. We can give you power during tax season in the following ways:

  • Paperwork management without stress: We can collect, organize, and label your tax documents for you, saving you time and making sure you have everything you need for a smooth filing process.
  • Accuracy and Speed: Leverage the knowledge and experience of our team to cut down on mistakes and increase deductions. You can focus on running your business while we make sure your tax return is filed correctly and quickly.,
  • Support Throughout the Year: Forget about getting organized until tax time. By being your partner all year, BusAcTa Advisors can help you keep your finances clean and in order, which will make filing your taxes a breeze.
  • Integrating easily for CPAs: We understand how hard it is for CPAs during tax season. Our team fits right in with your current workflow and gives you the help you need to do a good job for your clients.

Tax season doesn’t have to be a horrible thing if you work with BusAcTa Advisors. Let us handle the complicated parts of tax filing so you can focus on what’s most important: running and growing your business.

Read More:

1. Form 1040 (irs.gov)

2. Instruction 1040 (irs.gov)

3. Publication 17 Your Federal Income Tax for Individuals (irs.gov)

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