It is wise to get an early start on tax filings. This is particularly true in the wake of the recent Equifax breach. A recent piece by CNBC notes the massive leak of confidential consumer information could result in an increase in tax fraud — a process when fraudsters use tax payer’s information to get their tax refund.
Those who are looking to have their filings ready as soon as possible are wise to have a basic understanding of which forms they will need to complete their filings.
- Wages. Employees will need a W-2. This from breaks down wages and salary information as well as tax withholdings. Those who work as independent contractors or who receive income from rental property or other forms of nonemployee income would use a 1099-MISC. In some cases, a taxpayer would need a 1099-K to account for profits with Uber or Etsy sales.
- Stocks. Any stock sale or capital gain would require the use of a 1099-B.
- Health savings account distributions. The use of these accounts would result in the need for a 1099-SA.
- Social Security income. Taxpayers that receive Social Security income would also need an SSA-1099 to complete their tax filings.
These are some of the forms needed for the income portion of the tax return.
Deductions and credits require additional forms. This can include a 1098 for a mortgage interest deduction and a 1098-E for student loan interest deduction.
A failure to properly account for income and deductions can result in an audit. Those who receive notification of an audit should respond carefully. It is often wise to seek legal counsel. An attorney experienced in audit notices can explain the process and help better ensure your legal rights are protected.