As you begin gathering your tax information in anticipation of filing your 2013 tax returns, we wanted to provide the following list of useful notes and reminders:
- Important tax information forms will generally arrive to you at different times: W-2s, 1099-Rs, 1099-Misc, 1099-Div, 1099-Int, 1098, 1098-T must be mailed by January 31, 2014; 1099s from brokerage firms such as Charles Schwab, Fidelity, TD Ameritrade, E-Trade, etc. must be mailed by February 18, 2014; K-1s may arrive as late as September 15, 2014.
- If you paid federal or state estimated tax payments for tax year 2013, we recommend that you gather and provide the date paid and the check/confirmation number for the payment. We find that inaccuracies with estimated tax payments are among the most common reasons for receiving a tax notice from the IRS or state tax department.
- Upon request, you can often receive a computer generated report from your medical provider(s) and pharmacies that will provide a summary of out of pocket costs paid in 2013. This can be a more efficient and accurate method of determining deductible medical expenses versus organizing and adding up receipts.
- A charitable contribution (cash or non-cash) of more than $250 to a charitable organization requires that you obtain a written acknowledgement from the organization in order to take a deduction.
- Non-cash charitable contributions totaling more than $500 in 2013 require that you provide and report certain information for each contribution including the date of contribution, list of items donated, fair market value of each item, and original purchase price and purchase date of each item donated. Many charitable organizations have tools and resources available to assist in organizing and documenting the required information. A software tool such as It’s Deductible is a popular tool for consideration.
- A non-cash charitable contribution of property (other than publicly traded securities) valued at more than $5,000 requires that you obtain and attach a qualified written appraisal to document the value of the gift.
- Contributions into a donor advised fund are tax deductible charitable contributions. Grants out of the donor advised fund do not result in an income tax deduction.
- Making a gift to another person directly or in trust of more than $14,000 in 2013 requires that you file a federal (and perhaps Minnesota) gift tax return. Note that making a tuition payment for another person directly to the educational institution or paying a medical expense for another person directly to the medical provider do not count towards the $14,000 annual exclusion amount and do not need to be reported on a gift tax return.
Please contact us with any questions that arise as you gather and organize your 2013 tax information.