Page 26 - BusinessWest February 7, 2022

Taxes • File a report with the local police.
Documentation of Income
• W-2: Wages, salaries, and tips
• W-2G: Gambling winnings
• 1099-Int & 1099-OID: Interest income statements • 1099-DIV: Dividend income statements
• 1099-B: Capital gains; sales of stock, land, and
other items
• 1099-G: Certain government payments, statement
of state tax refunds, unemployment benefits • 1099-Misc: Miscellaneous income
• 1099-NEC: Independent contractor income • 1099-S: Sale of real estate (home)
• 1099-R: Retirement income
• 1099-SSA: Social Security income
• K-1: Income from partnerships, trusts, and
S-corporations
Documentation for Deductions
If you think all your deductions for Schedule A will not add up to more than $12,550 for single, $18,800 for head of household, or $25,100 for married filing jointly, save your time and plan to take the standard deduction.
Itemized Deductions
• Medical expenses, out of pocket (limited to 7.5% of adjusted gross income)
– Medical insurance (paid with post-tax dollars) – Long-term-care insurance
– Prescription medicine and drugs
– Hospital expenses
– Long-term-care expenses (in-home nurse, nursing
Continued from page 22
Be Vigilant
Be especially careful during this time of year to protect yourself against those trying to defraud or scam you. The IRS will never call you directly unless you are already in litigation with them. They will not initiate contact by e-mail, text, or social media. The IRS will contact you by U.S. mail. However, you still need to be wary of items received by mail. Anything requesting your Social Security number or any credit- card information is a dead giveaway for scam iden- tification. Watch out for websites and social-media attempts that request money or personal informa- tion. You can check the irs.gov website to research any notice you receive or any concerns you may have. You can also contact your tax practitioner for assistance.
What If You Have Been Compromised?
How do you know if someone has filed a return with your information? The most common way is your tax return will get rejected for e-file. These scam- mers file early. You may also get a letter from the IRS requesting you verify certain information. If this does happen, there are steps to take to get this rectified.
First, contact the IRS Identity Protection Special- ized Unit at (800) 908-4490. Then, file Form 14039 Identity Theft Affidavit, and paper file your return.
In addition, we recommend you take further steps with agencies outside the IRS:
• Report incidents of identity theft to the Federal Trade Commission at www.consumer.ftc.gov or the FTC Identity Theft hotline at (877) 438-4338 or TTY (866) 653-4261.
• Contact the fraud departments of the three major credit bureaus: Equifax: www.equifax.com, (800) 525-6285; Experian: www.experian.com, (888) 397- 3742; or TransUnion: www.transunion.com, (800) 680-7289.
• Close any accounts that have been tampered with or opened fraudulently.
Identity Protection PIN (IP PIN)
If you are a confirmed identity-theft victim, the IRS will mail you a notice with your IP PIN each year. You need this number to electronically file your tax return.
You may also opt into the IP PIN program. Visit www.irs.gov/identity-theft-fraud-scams/get-an-iden- tity-protection-pin to set up your IP PIN. An IP PIN helps prevent someone else from filing a fraudulent tax return using your Social Security number.
Get Your Paperwork in Order
Get your paperwork in order early to ease the stress of tax season. First, make a note of changes
to your life. Did you welcome a child to your family this past year? Get married? Will one of your children be claiming themselves for 2021? Or, if you’ve expe- rienced the unfortunate passing of your spouse or dependents, changes to your family will affect your return. Make sure you have all the necessary docu- mentation in order, and you know how it will be han- dled for your return.
Below is a list the most common required forms and items to gather, as well as few other things for you to consider as you prepare for filing your 2021 tax return. Please note that this list is not exhaustive because everyone’s tax situation is different.
To see how we can help your
Taxes
business, call 860.265.3920. Continued on page 42
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