If you live in the USA and are having trouble filing your taxes, then read this ultimate guide. Generally, people don’t find it easy to file taxes. It gets difficult to understand what documents you need to file the tax. But if you have the correct information, then you can nail it in the first attempt. Everyone pays taxes, even if it’s your neighbor or employer. But no one can file it on your behalf, so you have to take this road on your behalf. Thus, if you want to avoid mistakes and time wastage, it is good to read this guide to get accurate information.
How to file taxes? An ultimate guide:
If you live in the USA’s territory, then the deadline to file the tax has increased. Yes, now you can apply from April 15th to May 17th, 2021. So, ensure to file your taxes on time. But if you don’t file your taxes on time, you will have to face penalties, and the department will charge interest. But if you want to know about the documents and information that you need to file the taxes, then it depends on your situation. For instance, there could be the following conditions:
- If you are a self-employed ( 1099 independent contractor)
- College student
In both of the above conditions, you need the 1099 NEC and 1098 T-forms to file your taxes. Apart from this, a pay stub also plays a vital role during tax file submission if you are an employee.
Steps to file your taxes in the USA:
If you want a short procedure, then here are some quick steps that you have to take for the submission of the tax return in the USA:
- Keep track of your income.
- It is essential to save all documents like pay stub and others. You will need these documents while filing the tax returns.
- Now at the third step, keep an eye on the income that you are receiving. It is crucial whether you are a part- or full-time employee.
- Moreover, don’t forget to search about the deductions and discounts that you can take. But these deductions depend on your status.
- While preparing documents, don’t forget to keep an eye on the deadlines.
Last but not least, there are specific ways through which you can submit and file your taxes. So, decide the best and most convenient way.
Information that you need to file your taxes:
We mentioned earlier that every individual requires different information to file the tax. But it entirely depends on your situation. However, here we are dividing the required information into the following separate sections.
If you are filing taxes in the USA, personal information must be filled with the correct info. So, here are the following details that you have to provide in this section.
- The social security number or your previous tax ID
- The detail and tax number of your spouse
- Identity Protection PIN, if you, your spouse, or any other dependent has.
- The details and routing number of your bank
But this information could be less or more, and it entirely depends on the state tax department of the USA.
If you have any dependents on your own, then it is vital to provide detailed information in the form. So, you have to provide:
- DOB and national tax number of dependent
- The record of the childcare and NTN
- Income record of the dependents
- Form 8332 that shows you are the custodial parent of the child
Provide all sources of income:
Now, it is one of the most critical sections. Here you need to provide a complete record of the income on which you will pay tax. So, here are different sub-categories in this section:
|Employed||Unemployed||Self-employed||Rental income||Retirement income|
|Form W-2||Unemployment (1099-G)||Forms 1099, or 1099-NEC||Track of income and expenses||Form 1099-R|
|Track of expenses, business use assets, and receipts||Rental assets information||Record of the Social security income|
|Office in home info||Estimated tax payment||Traditional IRA basis|
|Estimated tax payment|
Furthermore, don’t forget to track savings, dividends, investments, and other income in the tax documents. But it’s also vital to mention losses if you are facing any.
It is vital to remember here; many other things are crucial to mention. For instance, claim if you are eligible for any deduction. There are the following types of deductions that you can claim while filing your taxes.
- Charitable donations
- Medical expenses
- Childcare expenses
- Educational expenses
- State and local taxes
- Retirement and other savings
Moreover, remember that filing status will be based on the fact whether you are married or not. So, always read the form correctly and fill out accurate information.