So, last week I ran through the (rather incredible) selection of NEW and/or extended tax credits available for San Luis Obispo business owners.
That’s just the tip of the iceberg though.
But this is the great thing about working with business owners in tax strategy … we can get so creative and make a MASSIVE impact for your bottom line.
It does take some partnership with you, of course.
As a Chorro business owner, you may have a couple different tax returns to wade through each year (and maybe more, depending on the number of active entities you’re managing).
Want to get a jump on things? Yes, or yes? Here’s where you can reach us:
Even though the IRS isn’t accepting electronic submission of tax returns until Friday, February 12, we are already in active conversation with clients to get started. And even if you do NOT have all of your documentation yet available, we can still get the ball rolling for you.
So, to that end, I’m here today with a large tax checklist that you can work from for your personal income taxes, understanding that every situation is a little different. Every San Luis Obispo business will have different requirements as well.
On the business side, much will be determined by the state of your books, expense documentation, and other such factors. We can dive into your books for what is needed, if it comes to that.
As I said, this is meant to be informational for you, and as something you can hold on to over the following weeks as you begin the process of excavating your financial files. There may be certain situations where we’ll need other documentation to get you even more deductions. But, of course, we’ll let you know about that, should the situation arise.
So … here we go.
A Checklist For San Luis Obispo Business Owners’ For 2020 Personal Income Taxes
“Don’t wait. The time will never be just right.” – Napoleon Hill
As I mentioned last week, depending on how your business entity is structured, you could be paying anywhere from 15-25% (or more!) of your business revenue into the coffers of the IRS and various state departments of revenue.
But this is what we’re here for. Working with business owners gives the chance to do a lot of damage to tax bills … but personal taxes are still “a thing”.
Below is a list of what you will need during the tax preparation process on the personal side. Not all of them will apply to you — probably MOST will not. Nonetheless, it’s a useful tax checklist.
Before you get overwhelmed: yes, this is a long list — but it’s the unfortunate reality of our tax code that it’s not even comprehensive! These items will cover 95% of our clients. Really, this is for ensuring that we’re able to help you keep every dollar you can keep under our tax code.
Also note: There are certain CARES Act (stimulus) and CAA (second stimulus) items that you will need to know as well. I’ve notated them in italics.
But again … we will be your guide. That’s what we’re here for.
Even if for some strange reason you won’t be using our cost-effective services this year, feel free to use this list as a handy guide…
Social Security Numbers (including spouse and children)
Child care provider tax I.D. or Social Security Number
Employment & Income Data
-Amount of CARES Act (1st Stimulus) payment received – paid ~ April/May 2020 ($1,200 per adult, $500 per child)
-Amount of CAA (2nd Stimulus) payment received – paid ~ early January 2021 ($600 per adult & child)
W-2 forms for this year
Tax refunds and unemployment compensation: Form 1099-G
Miscellaneous income including rent: Form 1099-MISC
Partnership and trust income
Pensions and annuities
Jury duty pay
Gambling and lottery winnings
Prizes and awards
Scholarships and fellowships
State and local income tax refunds
Health Insurance Information
NOTE — As it says on the IRS health insurance information page, form 1040 will not have the “full-year health care coverage or exempt” box and Form 8965, Health Coverage Exemptions, will no longer be used. You need not make a shared responsibility payment or file Form 8965, Health Coverage Exemptions, with your tax return if you didn’t have minimum essential coverage for part or all of 2020.
* All 1095-A Forms from Marketplace providers (if you purchased insurance through a Marketplace)
* Records of credits and/or advance payments received from the Premium Tax Credit (if claiming)
Residential address(es) for this year
Mortgage interest: Form 1098
Sale of your home or other real estate: Form 1099-S
Second mortgage interest paid
Real estate taxes paid
Rent paid during tax year
Moving expenses (if in active military, and moving for new orders)
Reimbursements for moving (counts as ordinary income)
Interest income statements: Form 1099-INT & 1099-OID
Dividend income statements: Form 1099-DIV
Proceeds from broker transactions: Form 1099-B
Retirement plan distribution: Form 1099-R
Capital gains or losses
Auto loans and leases (account numbers and car value) if vehicle used for business
Student loan interest paid
Early withdrawal penalties on CDs and other fixed time deposits
Personal property tax information
Department of Motor Vehicles fees
Gifts to charity (receipts for any single donations of $250 or more)
Unreimbursed expenses related to volunteer work
Education expenses (tuition and fees)
Child care expenses
Medical Savings Accounts
Number of Days you were unable to work due to being quarantined due to the COV virus or due to symptoms of COV, including time while waiting for test results (do not include days reimbursed by an employer)
Number of Days you were unable to work due to caring for a family member who was quarantined due to COV or caring for a child due to the closure of a childcare facility / school
Estimated tax vouchers for the current year
Self-employment SEP plans
Self-employed health insurance
K-1s on all partnerships
Receipts or documentation for business-related expenses
State and local income taxes (note: $10,000 limit, as last year)
IRA, Keogh and other retirement plan contributions
Other miscellaneous deductions
An important thing to understand is that we will guide you through the process, and that although much has changed this year, we are on top of these changes on your behalf.
We’re here to help. Let me know if you have any questions. Use this:
I’m grateful for our partnership, and for your referrals, ~Contact.FirstName~.
Burkart & Stevens, CPAs and Advisors
Feel free to share this article with a San Luis Obispo area (or beyond!) business associate or client you know who could benefit from our assistance. While these particular articles usually relate to business strategy, as you know, we specialize in tax preparation and planning for families and business owners.