Filing a complete and accurate tax return is the best way to ensure receiving the refund is a smooth process or helping to curb receiving IRS notices.
1. Gather Personal Information
- Social Security numbers and the date of birth for everyone on the tax return
- Current address after moves
- Updated bank account routing and account numbers for direct deposit or direct debit
2. Gather Tax Documents
- Tax forms of income: W2s, 1099s, K1s, brokerage statements, etc
- Tax forms for credits & deductions: 1098, 1098-E, 1098-T, childcare payments, etc
- Other tax information: Marketplace health insurance statements, any IRS letters or notices received during the year, information on digital assets & cryptocurrencies, information on foreign bank accounts/land ownership, etc
- Payment information for any estimated tax payments made for that tax year
- Prior Year Tax Returns if going to a new preparer
3. Report All Income, Even If No Tax Form Received
- Payments for services below the $600 threshold to receive a form 1099
- Tips not reported to an employer/showing on your W2
- Part time or seasonal work
- Self-employment and business activity
- Gambling income (and losses)
- Hobby Income
4. File Electronically (if possible)
- Paper returns have a much higher probability of math errors and missed forms/worksheets and slow process time
- Choose direct deposit to improve the time it takes to receive a refund
- Consider Direct Pay on irs.gov for balances owed, and receive a confirmation of payment
- If asked for the prior year AGI, list the number on your 2021 tax return if it was filed & processed, or $0 if the return has not been completed/processed yet
- Low income taxpayers can take advantage of IRS Free File (https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free) to prepare their own tax returns and avoid high preparation fees
5. Choose A Tax Professional With Credentials
- Choose a CPA, EA, or tax attorney: the credentials require continuing education to ensure knowledge of changing tax codes
- Realize that anyone can go on the IRS website and obtain a PTIN for ~ $35 and legally be able to file tax returns, no knowledge or experience needed
Tax Professionals can be found on the IRS Preparer Directory (https://irs.treasury.gov/rpo/rpo.jsf). To learn more about the different credentials, visit the IRS for their Preparer Credentials explanation (https://www.irs.gov/tax-professionals/understanding-tax-return-preparer-credentials-and-qualifications)
