Reviewing a tax return can always be an informative exercise to ensure you understand all sources of income and tax liabilities for the prior year. This is true for existing clients with whom we have been working and is especially true for new clients as a way to familiarize ourselves with their situation.
In this checklist, we highlight points to consider on your tax return if they are working, including:
Review the filing status. If they are married should they automatically file jointly with their spouse or might there be situations where the client might consider filing separately?
If the client is divorced or widowed, there are filing steps for them to take depending upon timing and circumstances.
If you have dependent children, you may be eligible for certain credits.
If you had investment income for the prior year, there are reporting issues that you will want to be sure you have addressed in connection with this income.
If you owned tax-advantaged accounts during the prior tax year, there may be some reporting issues to consider. Did you convert a traditional IRA to a Roth? Did you contribute to an HSA or a 401(k) plan?
Check to see if they owned rental real estate or if there are state-specific issues to be considered.
This is a comprehensive checklist of the types of issues that advisors should be discussing with their clients who are working when reviewing their tax returns from the prior year.
Family Filing Issues
Investment Income Issues
Retirement Plan Issues
Income Related issues