Gather all year-end income documents

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As taxpayers prepare to file their taxes, the first thing they need to do is get their records together. To avoid processing delays that could slow down their reimbursement, taxpayers should gather all year-end income documents before filing a 2021 tax return.

It is important that people have all the necessary documents before they start preparing for their return. This helps them file a complete and accurate tax return. Here are some things taxpayers should have before they start paying their taxes.

• Social security numbers of each appearing on the income tax return. Many taxpayers have these numbers memorized. However, it is a good idea to have them on hand to verify that the numbers on the tax return are correct. An SSN with the wrong number or two inverted numbers will cause processing delays.

• Bank account and routing numbers. People will need it for direct deposit refunds. Direct deposit is the fastest way for taxpayers to get their money and prevents a check from being lost, stolen, or returned to the IRS as undeliverable.

• You don’t have a bank account? Find out how to open an account at an FDIC insured bank or through the National Credit Union Locator Tool. Veterans can access the Veterans Banking Benefit Program.

• Employer W-2 forms.

• Forms 1099 from banks, issuing agencies and other payers, including unemployment benefits, dividends, distributions from a pension, annuity or retirement plan.

• Form 1099-K, 1099-MISC, W-2 or other income tax return for workers in the odd-job economy.

• Form 1099-INT for interest received.

• Other income documents and records of virtual currency transactions.

• Forms 1095-A, Medicare Market Statement. Taxpayers will need this form to reconcile advance payments or claim the premium tax credit.

• Letter 6419, 2021 Total Child Tax Credit Advance Payments, to reconcile Child Tax Credit Advance Payments.

• Letter 6475, Your 2021 Economic Impact Payment, to determine eligibility to claim the recovery reimbursement credit.

Forms typically start arriving in the mail or are available online from employers and financial institutions in January. Taxpayers should consider them carefully. If any information on the forms is incorrect, the taxpayer should contact the payer as soon as possible for a correction.

Tax advice 2022-04


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