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TIME TO GET CRACKING ON THOSE RETURNS!

February 03, 2006

There's no point in putting it off now. The last 1099s are trickling in, you have your W-2s and your stockbroker statements. It's time to get cracking on putting your tax information together.

What, you say? It's Super Bowl weekend! It would be sacrilege to mar such a solemn occasion by wading through tax records!

Well, consider this your financial Super Bowl, without the wardrobe malfunctions. As you sit down to get your information to your preparer (even if that means you), here are some hints to make the process easier for the preparer and cheaper for you:

- Use the organizer. Most preparers will provide you an "organizer" based on your 2004 return. It will list out all of the income and deduction items that you had last year. You can save a lot of hassle just by making sure you account for all of the items listed there.

- Make sure you have all of your 1099s. If you got an organizer from your preparer, check against the list. If you don't have an organizer, check against the dividends and interest shown on last year's return. Then ponder any new stocks, brokerage accounts, or bank accounts you opened in the last year, and make sure you also have those 1099s.

- Get all of your W-2s. Did you change jobs? Did your spouse? Make sure you have all of that.

- Get your stock sale information together. Schedule D, the capital gain schedule, is often the most expensive part of the return. You can keep it from being that way if you make sure to list for each stock sale:

1. The date you bought it;
2. How much you paid for it; and
3. The date you sold it and the sale price.

Don't forget to include the brokerage fees with your information.

If you have held the stock for a long time, make sure to take stock splits into account. If your broker has a nice schedule with all of this information - and many do - be sure your preparer gets it.

Mutual Funds: Include all of the tax information you get from the funds. If you sold shares, try to find out your basis from the fund company; if you are like most mutual fund owners, you have been reinvesting your dividends in additional shares, and you get basis for that.

Own tax-exempt securities? Give the preparer the year-end information. Most federally-exempt securities are taxable in Iowa. Even double-exempt securities can affect your federal return, or returns you may have to file in other states.

- Did anything else unusual happen during the year? Did you cash in an insurance policy? Settle a lawsuit? Buy or sell a house? Refinance a mortgage? These things can all affect your income taxes. If you're not sure if something matters, give it to the preparer.

- If you have your own businesses or rental properties, be sure to give the preparer all of the income and deduction information you have. If you use Quicken or Quickbooks, give the preparer an "accountant's copy" or backup of your computer file. It can save a lot of time.

- Document your deductions and credits. Round up your 1098s for your home mortgage interest, your property tax statements, and your charitable contribution receipts. Go through your checkbook and make sure you really made those estimated tax payments, and write them down on your organizer, noting the dates. And don't forget to tell your preparer about your vehicle registration fees, as they may include a property tax.

Think about deduction items that may not have been on your return last year. Some are easy to miss:

* Did you have unusual contributions this year - say, a college fund drive? Make sure you have the receipt from the donee; cash donations over $250 require a written acknowledgement from the donee.

* Did you donate property? Remember that you will need an appraisal for non-stock gifts over $5,000. Ask your preparer about the information needed from the appraiser.

* Did you go back to school? You may be eligible for a tax credit.

* IRAs? Tell your preparer about any IRA contributions you made, even if you don't think they're deductible.

* If you like to gamble, list your losses so your preparer can claim them against gambling income. Many casinos can give you a printout of your activity. If you use the touch play slot machines video lottery units, call Ed Stanek on his cell phone to get your tax information.

* Did you contribute to College Savings Iowa? There is an Iowa deduction available.

* Did you have kids in elementary or high school? There is an Iowa credit for tuition and fees. Eligible items include textbook costs, instrument rental, football cleats, and, oddly, prom tickets.

You know you can't possibly enjoy this year's wardrobe malfunctions with your taxes weighing on you. Get your tax information together and you can enjoy the game, or at least the halftime show, with a clear conscience.

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