4 Common Tax Forms
tax preparation requires a working knowledge of the forms you need to avoid errors, omissions, late payments, and correlating fees. Here, review some of the most common tax forms, all of which are available at IRS.gov. You can also request these forms by mail or get them at taxpayer assistance centers and community locations, such as libraries, grocery stores, office supply stores, and copy centers.
Tax Forms You Need to Know About
Form 1040 is the comprehensive, standard federal form most individuals use to file, as it lists your income, credits, deductions, and taxes. This form is necessary for individuals who earn over $100,000 annually, need to report self-employment income or property sales, or have deductions to itemize.
Depending on why you need a 1040, you may also need Schedule A and B forms. Schedule A lists your itemized deductions, including charitable donations, state taxes, and mortgage interest, while Schedule B shows all taxable dividends and interest totaling over $1,500 for the calendar year.
If you're a salaried employee, you need a W-2. Also referred to as the Wage & Tax statement, your employer sends you this form, detailing how much you earned during the tax year, what taxes were withheld, and how much you contributed to your retirement plan. How much your employer paid for your health insurance plan also appears on the W-2.
When you work as an independent contractor and are self-employed, you receive 1099-MISC forms. Any client who pays you $600 or more for the year sends you this form detailing the payout totals. Each client then gets listed with the earned amount when you do your taxes, as failing to report miscellaneous earnings makes you subject to tax penalties.
Known as the Employee's Withholding Allowance Certificate, a W-4 tells your employer the amount of income to withhold from your checks when you start a new job in light of your dependents and filing status. Life changes, such as getting married or having a baby, require filling out a new W-4 to prevent over- or under-paying for the tax year.
If you need help with your tax preparation this year, contact ZP Tax, Inc. in Silver Spring, MD. No matter what your filing status is, they’ll help you receive all the correct forms and sidestep issues, such as fees and audits. Call (301) 587-4829 today to get started, or learn more about their tax preparation services online.