Preparation is crucial for all businesses. Preparation can help minimize stress and anxiety when dealing with your business taxes. Anyone who has ever been involved with the Boy Scouts knows that the motto of the organization is “be prepared.” Preparation, however, is more than just a good motto. It is also a virtue to live by in all aspects of life.

A typical American pays roughly 30% of every dollar earned in some form of income tax. In addition, when you add up all the property taxes, licensing, and other government fees, this figure could easily reach 50%. Therefore, with such a high percentage of your income at stake, being prepared is the only way to ensure that you keep your tax liability as low as possible.

As you prepare your taxes this year, here is a list of critical information you want to gather and send to your accountant:

W2s and 1099s: The January 31 deadline has come and gone, so you should have all the W2s and 1099s you are going to receive this year. If you are missing any, follow up with your employers and request copies. Be sure you have all of these forms, because if any are missing, this will jeopardize the accuracy of your tax return.

Mortgage Interest Receipts: If you have a home mortgage, your lender should have sent you documentation of the interest you paid last year. This can often add up to several thousand dollars, and it is all tax deductible. Do not forget about second mortgages and/or home equity loans. If you have either of those, you can deduct this interest as well.

Property Tax Statements: In addition to mortgage interest, homeowners are allowed to deduct the property taxes paid on their house during the year. You should have received a statement from the county in which you live showing your property taxes paid last year.

Charitable Contributions: If you donated to a church or charity, you should have a receipt from the organization. If you donated a vehicle, clothes, or other merchandise, you should also have been given a receipt for this donation. Gather all charitable receipts you have so you can gain the maximum deduction possible in this area.

Bank Statements: Collect all statements from bank accounts wherein you have interest bearing dollars on deposit. Often, these will be small amounts of interest income earned, but everything needs to be documented, even if it ultimately does not affect your tax bracket and/or payments owed.

Brokerage Account Statements: Your accountant will need to be aware of any capital gains or losses you had last year, and most of these will have occurred within stock accounts you may have.

Work Related Expenses: You may have incurred qualified work expenses that were not reimbursed by your employer. Collect receipts of any such expenses so you can deduct them.

Self-Employed Expenses: If you are self-employed, you have several possible deduction opportunities available. These include:

• Travel Expenses
• Car Mileage/Maintenance
• Meals/Entertainment
• Utilities
• Advertising
• Equipment
• Contract Labor
• Home Office

Ideally, records of these expenses should have been kept throughout the year. If not, do your best and gather up as much as possible for your CPA to sort through.

Numerous additional tax credits and deductions may be available for your particular situation. Speak to a professional accountant to make sure you are doing the maximum possible to minimize your tax burden.