You've finally decided to start outsourcing your tax prep to a tax pro instead of going it alone. Congratulations! Way to recognize when you need help so you can stay in your zone of genius! But to make the tax filing experience as smooth as possible, it's essential to know what to bring to your tax appointment.
To help with that, here's a short checklist of information and documents to gather ahead of time. Follow it step by step, and your tax pro will soon be calling you one of their favorite clients.
What to Bring to Your Tax Appointment
Most small business owners either file Schedule C with their Form 1040, U.S. Individual Income Tax Return, or file both a business and personal tax return, so this list covers both.
Basic Tax Prep Information
- Prior year return. Having a copy of last year's tax return helps your tax preparer gather information and calculate certain tax deductions and credits without calling you repeatedly.
- Social Security numbers. Provide full names for you, your spouse, and dependents (if applicable) as they appear on your Social Security cards, as well as Social Security numbers.
- Home and business addresses. The IRS requires you to list a street address on your tax return. You should only use a P.O. Box if your post office doesn't deliver mail to your home.
- Future tax planning. Expecting any significant changes in the coming year? Let your tax pro know about them now. They may have ideas for minimizing your tax bill next year.
- Employer identification number. Your tax preparer needs this number if your business has a separate EIN.
Income Records
- W-2s and 1099s. These forms report wages, independent contractor payments, interest, dividends, capital gains, retirement plan distributions, and more. Be sure your tax preparer has all of these so they can include all taxable income on your return.
- Business financial statements. At a minimum, your tax preparer needs a copy of your balance sheet, income statement, and general ledger. If you use cloud accounting software, consider giving your tax pro accountant access to your file. That allows them to dig into the details if they have questions about certain balances or business expenses.
- Cryptocurrency transactions. Did you receive, buy, sell, or exchange Bitcoin or other forms of digital currency during the year? If so, give your tax preparer a schedule of all cryptocurrency transactions or print out transaction reports from each exchange platform you used during the year.
Tax Deductions and Tax Credits
- Mileage log. If you use your personal vehicle for business, get the total business miles and personal miles driven for the year from your mileage log or mileage tracking app.
- Asset purchase details. If you bought any long-term assets for your business, such as furniture, computers, vehicles, equipment, or real estate, your tax preparer needs a description of the item, the purchase price, and the date you placed the item in service.
- Payroll records. Bring copies of your year-end payroll records or payroll tax returns, as well as W-2s issued to employees and 1099-NECs issued to independent contractors.
- Home office. If you have a home office, your tax preparer needs the square footage of the office vs. the square footage of your entire home. They also need deductible home office expenses, such as mortgage interest or rent payments, utilities, repairs, cleaning, property taxes, and homeowners' insurance.
- Itemized deductions. Bring a copy of your Form 1098, Mortgage Interest Statement and other information supporting itemized deductions, such as out-of-pocket medical expenses, receipts for charitable donations, and state and local taxes.
- Self-employed health insurance premiums. Gather the premiums paid for medical, dental, and vision insurance for you, your spouse, and your dependents.
- Dependent care expenses. If you paid for childcare, your tax preparer needs your daycare provider's name, address, EIN, and the amount paid during the tax year.
- Retirement plan contributions. Document your donations if you contributed to an IRA, SEP-IRA, or another retirement plan.
- Education expenses. Your tax preparer needs copies of Form 1098-E, Student Loan Interest Statement for any student loan interest paid, Form 1098-T, Tuition Statement for college tuition, and fees paid for you or your immediate family members. If you contributed to a 529 plan for your dependents, bring your total contributions for the tax year as well.
Tax Payments
- Prior year overpayments. If you overpaid your taxes in the prior tax year and had your overpayment applied to this year's estimates, that figure should be on your prior-year return. Be sure to let your tax preparer know if you received a notice from the IRS that they changed your return.
- Estimated payments. Most small business owners must make estimated tax payments throughout the year. Let your tax pro know how much you paid toward your federal and state taxes and when you made the payments.
- Extension payments. If you requested an extension of time to file your return, you might have made an estimated payment with your extension.
Gathering all the information you need to file your tax returns can be daunting, so start early. Getting organized and having a good filing system in place will make this year's tax appointment easier and set you up for success next year.
