TAX TIME!

Here's a guideline to help you remember what to bring in, and some expenses you may be able to deduct

Most of these items we've talked about or will talk about every year.

• W2s
• 1099-INT (bank) or a summary,
• 1099-DIV (investments), 1099-B (stock sales)
• 1099-G (unemployment)
• and any other tax documents

Those who itemize: bring a record of these expenses:

• Medical and Dental: (think of all your senses)
  eye doctor, contact lenses/solution, glasses; hospitals, outpatient fees, co-pays and premiums, out-of-pocket expenses, prescriptions, dentists, hearing aids, etc., travelling to hospital/appts. (If you have a flex-spending plan, pay for nonprescription drugs out of that.)
    --Remember, expenses need to add up to more than 7.5% of your adjusted gross income to start counting.

• Car excise tax; estimated tax payments to state

• Homeowners:
  --year-end mortgage statement
  --real estate tax paid (if from escrow will be on the statement, otherwise it's not the fiscal year billing, it's what you actually paid)
  --if any points paid (new loans deductible; refi loans deduct over life of loan)

• investment (margin) interest
• Record of charitable donations
    --IRS requires you to keep proof of cash donations (letter from the charity/church is proof)
    --if over $500 noncash, receipts showing date and items given
    NEW: Cash-like donations to Haiti Jan 12 thu Feb 28 this year may be claimed on your 2009 tax return
  

• Employee Business Expenses:
  Job-related:
    --professional or union dues, professional journals/subscriptions, specialized work uniforms, tools
    --job search (in same profession): resumes, interview travel, job counselor/head hunter fees
    --home office for the convenience of the employer (not simply your choice), and used regularly and exclusively for business
    --work-related car expenses: (travel to clients, different job locations, but not if only commuting to single work location and home)
    --record odometer Jan 1 and Dec 31, then track business miles for either method:
    actual expenses: record ALL gas, oil changes, repairs, AAA, car wash, etc. for entire year (or) standard rate for business miles
  Finance-related:
    --tax preparation, safety deposit box, investment fees
  

Children:

• New family additions: name, date of birth, social security number
• Daycare: if different from last year, name and address, EIN (or SSN if person providing care)
• Adoption costs

Education:

• Work-related or post-secondary tuition, for self and dependents
• Student loan interest

Other Income:

• Rental property:
    --if property being newly rented, I need date "placed in service" (ready and available to be rented), original purchase price (bring in settlement sheet) or if being converted, FMV of property at time ready to rent.
    --any structural improvements and additions, appliances, etc, which are depreciated; repairs, maintenance, mortgage interest, real estate tax, and all related expenses, etc.

• Self-Employment:
    --remember any computer purchases, stationary, advertising, office expenses, % tax prep for Sch C, etc.
    --Meals and Entertainment: purpose is to meet/entertain clients and prospective clients
    --Gifts: maximum deduction is $25/client, additionally any small advertising giveaways
    --Home office: room or area regularly used, and exclusively business
    --Health insurance, if you are not eligible to be covered through your/spouse's employer plan
    --SEP-IRA, a self-employment IRA, deductible amount may be limited by Sch C income
  

Odds and Ends: Do any of these situations apply to you?

• National Guard reservist: travel over 100 miles/stay overnight, deduction for travel
• Alimony: income is taxable and paying it is deductible
• Teacher Expense (K thru grade 12 teachers)
• Moved over 50 miles for a job-related reason
• Purchase of a hybrid or clean-fuel car

NEW LAWS (or those with that "still-new smell")

• First-Time Homebuyer's Credit: up to $8000 credit
     (now extended thru April 30, 2010; includes current homeowners purchasing new residence)
• Not itemizing? Now you can deduct some of your real estate tax or sales tax on a new car
• Foreclosure: Cancellation of debt may be excluded from income
• Energy-efficient windows/doors and insulation (reenacted in 2009)

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This is not a comprehensive list, just a general guideline.

Also remember every year you can check out the links on my website for more tax information.
(I usually post it after the summer when the Congress passes and the IRS interprets the new tax laws.)