You will be receiving many of the documents we will need to complete your return within the next month or two. This may include a W-2 from your employer showing what you've earned this year, Forms 1099 reporting any additional earnings and investment income you've received and statements from your mortgage company, bank or other lender with details that will need to be reported on your return.
You may also receive other paperwork, documenting medical bills you've paid and charitable donations or financial investments you have made. We recommend that you set aside all of this material as soon as you receive it in a special folder or envelope so that you don't have to search for it when it is time to come in for your tax appointment.
Make Order Out of Chaos
Gathering your documentation is a good first step, but it's also important to put it in workable order. Take statements and papers out of the envelopes in which they were mailed so they are easier to identify and access. Sort the paperwork into different files or folders based on whether it relates, for example, to income or deductions. You might also want to make a list of the documents you have and the amounts involved in each case. We can certainly help you with this process if you have any questions.
Note: If you are a current client of our firm, we have recently sent you an organizer to assist you with the organization process.
Prepare Throughout the Year
Not all of the documents we require to prepare your tax return will come in the mail in January and February. For example, we may need credit card or bank statements and records of cancelled checks that you receive during the year that show purchases or transactions you have made. We might also use receipts that verify items you're deducting or donations you have made.
You should also set aside documents relating to major events during the last year, including the closing documents and mortgage information for a home purchase. That's why it's a good idea to create a tax file for next year today, to gather the material we'll need for next year's return now.
Please call us with any questions you may have about what is needed to prepare your 2011 tax returns.
"Copyright 2010 The American Institute of Certified Public Accountants"