What to Give Your Tax Preparer
NEW YORK ( TheStreet) -- So you have chosen a tax professional to prepare your 2012 Form 1040. What information should you give him or her?
Begin with all copies of all W-2s, 1099s, 1098s and K-1s from all sources. Make and keep a photocopy of your W-2s, as you may need it for college financial aid or other applications.
Include a detailed listing of itemized deductions, rental income and expenses, self-employment income and expenses and child-care expenses. Your preparer doesn't need to see the individual bills, receipts or canceled checks -- a detailed list or worksheet with specific numbers is sufficient.
"Claim the maximum" or "Whatever I am allowed" or "Same as last year" won't cut it. The maximum is what you actually paid, and you are allowed what you actually paid! Give your tax pro actual, specific numbers.
It is important to list the Social Security or Employer Identification Number for all child care providers. The IRS will disallow the Credit for Child and Dependent Care Expenses if you do not provide an identifying number on the Form 2441.
Provide your preparer with all year-end statements, reports, booklets and other literature received from brokerage accounts and mutual funds. The statements will contain details on cost basis, purchases, dividend reinvestment, margin interest, management fees, etc., and booklets often include information on income from U.S. government obligations useful in preparing your state return. I also ask clients to give me the final pay stub for the year for each employer.
And be sure to give him or her the dates of birth for yourself, your spouse and all dependent children.
You will need to provide your tax preparer with additional information if certain special situations apply:
If you sold shares of stock or a mutual fund: The date of purchase and cost of the shares sold. If you bought the shares through dividend reinvestment, the amount of dividends reinvested each year. If the investment was inherited, the number of shares you inherited and the date of death of the person from whom they were inherited.
If you sold real estate: The Closing/Settlement Statements for the purchase and sale of the property, plus the cost of capital improvements made over the years.
If you bought real estate: The Closing/Settlement Statement for the purchase of the property.
If you refinanced a mortgage: The Closing/Settlement Statement for the refinance and the term of the new loan.
If you are getting IRA distributions: The year-end statements for all IRA accounts.
If you have dependents in college: All Form 1098-Ts received, the "Bursar's Reports" for the year (you may be get a print-out from the college's website) and the amounts paid for books and supplies.
If you got a distribution from a pension plan: Whether you rolled-over the distribution to an IRA.