- Medical and Dental Expenses
- Taxes You Paid
- Interest You Paid
- Gifts to Charity
- Casualty and Theft Losses
- Job Expenses and Certain Miscellaneous Deductions
- Other Miscellaneous Deductions
When you marry, you get to change your income tax filing status. You may also change your name. When you do change your name, be sure to include Social Security Administration in all the name-change notifications you make.
Did you know you are born with an income tax return filing status? We all start life as Single. Even is you are a twin, you are a Single taxpayer. Can a baby be a taxpayer? Well, did you ever hear of the Gerber Baby? The answer is “Yes.”
Your filing status is determined by your marital status on the last day of the calendar year. When you marry, and are married as of December 31st, you will generally choose Married Filing Jointly. What else could you choose? You could choose Married Filing Separately. You might qualify for Head of Household.
One of my clients asked, “You mean if I get married on December 31st, I am treated as I was married ALL YEAR?” And the answer to that question is YES. Maybe you want to marry on December 31st, but wait until after midnight to say “I DO!” and sign the license on January 1st. With planning, you can choose the year you begin your joint return.
One thing I want you all to know is, “When you marry the person, you marry their tax troubles, too.” So be sure you know all the facts and enter into this new partnership, this new joint venture, with your eyes open. When you file a joint tax return, your taxable income includes the worldwide income of both taxpayers.
On a tax return for two people legally married, one is the primary tax payer and the other is the secondary tax payer. This just means that the name listed first is referred to as primary and the name listed second is considered secondary. The terms husband and wife don’t always fit. The IRS may still use the terms taxpayer and spouse.
Another filing status is Qualifying Widow or Widower. Special tax rules come into play with each of these choices. Do you have a choice when choosing your filing status? What was your personal situation on December 31st?
Have you heard, “Things Change.”? How many times was Elizabeth Taylor married? Like Liz, you may find yourself returning to Single when the other filing status no longer applies to you. Are you making changes this year?
- Keep your copies of your tax returns FOREVER. ..
- The Internal Revenue Service has THREE YEARS time to examine your tax records. This is called the Statute of Limitations for examination or audit. ..
- Your state has MORE time. Arizona has ONE more year. California has TWO more years. Which state are you in? How much longer do they have to look at your tax records? ..
- For calendar-year tax return items, you must keep your records AT LEAST five years. But some records need to be kept even longer. ..
- Don’t be in too big a hurry to get rid of the paperwork. Keep the original documents. Scan them. Use a cross-cut shredder to really destroy the no-longer needed documents.
- A plastic cabinet is convenient, but not secure like a locking cabinet. How many drawers does it have? Have one drawer for each of the 5 prior years plus a drawer for the current year. Permanent files will take up more space over time, so you may want a more secure place for your long-term permanent file. …
- Label the drawers 2015 (current paperwork for the coming year.) 2014, 2013, 2012, 2011 and 2010 for the years still open for audit. Look at the date you filed your 2010 tax return. Count forward five years to determine when (what date) it is actually safe for you to begin shredding. …
- In each of the 5 years’ drawers keep your tax return for that year. Keep a small box for your income records, your expense receipts and records of anything you sold in that year. …
- Keep a file of paperwork related to assets or investments you still own. You will use this “basis” information In the year you sell an asset or investment. It will help your determine the gain or loss on the sale. In the year of sale, that paperwork will go into that year’s tax box.Because state returns are generally based on the federal return, keep the IRS return and the state return’s documents together. …
- Save the tax returns in your permanent drawer. Shred the documents that are related to items only pertinent to a single year’s tax return for which the statute of limitations has already expired. For 2010 returns timely filed in 2011, the IRS statute “tolls”, or expires, in year 2014. The Arizona statute for 2010 returns runs out in 2015. The California 2010 tax return expires in 2016.
- Keep your copies of your tax returns FOREVER. Yes, every year that you filed. You never know when you (or your heirs) will need to look back.
- The Internal Revenue Service has THREE YEARS time to examine your tax records. This is called the Statute of Limitations for examination or audit. This 3-year clock runs from the date your tax return was filed, or the date your return was due, whichever is later. …. If you filed your tax return on February 14th, and it wasn’t due until April 15th, the later of the two dates is April 15th. If your tax return was due on April 15th, but you didn’t file your return until August 15th (it may have been on extension so you avoided late-filing penalties) the 3-year “statute” clock doesn’t start running until August 15th, the later of the two dates.
- Your state has MORE time. Arizona has One more year. California has TWO more years. Which state are you in? How much longer do they have to look at your tax records? … We are just finishing 2014. We will file the 2014 tax returns in calendar year 2015. Three years from 2015 is 2018. Four years from 2015 is 2019. But the records are from 2014. And the 2019 is FIVE years later than 2014.
- So how long must you keep your records? For calendar-year tax return items, you need to keep your records AT LEAST five years. But some records need to be kept even longer. … Take a deep breath. It’s not too difficult to understand. And it is not too difficult to do. Keep cancelled checks and paperwork related to stocks, or other investments you buy and sell, until 5 years after the date of sale. Keep documents related to the purchase, improvement, refinance of your home and other real property, until 5 years after the sale of each property.
- Don’t be in too big a hurry to get rid of the paperwork. Keep the original documents. Scan them. Technology is great, but things change over time and anything can fail. Don’t just toss or recycle sensitive information. Use a cross-cut shredder to really destroy the no-longer needed documents. .. Debbye Cannon of SmartCut Solutions shared an easy way to corral the clutter. She recommended using a plastic multi-drawer cabinet you can find in any office supply store.