There are basically thirteen categories of items that a tax preparer will organize for the tax return. Below is your tax season checklist:

1.W-2s; (if you have worked for someone else and must pay them before the second week of January)

2. 1099 of all brokers, landlords and contractors;

3. 1099s from all institutions reflecting interest and dividend income, stock brokers, mutual funds, and in particular 401(k) and IRA distributions (these can be easily overlooked, never sent or filed in the wrong place when they arrive well). in the following fiscal year) and mortgage interest statements (usually also on your December 31 statement);

4. W2-P or 1099-R for pension and annuity income;

5. Schedule K-1 if involved in partnerships or S corporations;

6. 1099 and year-end statements for unemployment compensation, Social Security income, and state tax refunds or taxes paid;

7. Contracts for the purchase and sale of equipment (to be depreciated or used up);

8. Security deposit declarations for the purchase and sale of goods;

9. Charity confirmations for donations of $250 or more and/or written receipts from charity or bank records for donations less than $250;

10. Unreimbursed expenses for nights away from home and the number of nights away from home to qualify for the per diem deduction currently at $59 per night and eighty percent deductible;

11. Separate business expenses by category, such as fuel, repairs, tolls, supplies, hired labor, tires, insurance, phone, faxes, copies, postage, travel, moving, small office machines, tools, additives, cleaning, any non-staff. -food items, truck/car washes, association memberships, licenses and special equipment;

12. IRA contributions, or contributions to the SEP plan, Simple IRA, Keogh, and/or UNI 401(k). Contributions to these plans can be made until April 15 of the following year as long as the plans are in force the previous year.

13. Other taxes paid, such as estimated tax (usually paid quarterly), property, sales, highway use (2290), county, state, local, and capital gains.

There are two ways to calculate vehicle deductions. One is calculated by mileage, which will require a log entry per usage or trip. The other is depreciation calculated from percentages dictated by the IRS. Remember to always include interest paid on a vehicle contract even after calculating depreciation if depreciation is the method of choice. Of course, the method that maximizes the business vehicle deduction from gross receipts would be the method of choice.

Some people make a spreadsheet and record all their entries on their computer. Others use programs that categorize their expenses for them and spit them out into a tax program. Some diligent people will staple their receipts in a particular category along with their calculator tapes. Then there are those who are right to throw their receipt in a shoebox and let their wives fix them.

Just remember, the more you do, the less it will cost you. Plus, if you stay on top of things, you’ll always be up to date on your tax position. And always, always do it soon!

Isn’t it amazing how easy this all looks when broken down into categories? You are well informed about what bookkeepers, CPAs, the IRS, tax attorneys, and bankruptcy courts are looking for well in advance.