Tax Preparation Checklists To Help You Get Your Tax Documentation In Order

TurboTax TaxCaster 2018 - 2019 Income Tax Calculator Data Entry Checklist

This TurboTax tax tool is by far one of the best tax planning apps I have on my iphone. It offers an on the go tax data registry in the palm of your hand. When things change or events happen that can effect my taxes, I can just plug them into the TurboTax TaxCaster App and this tax calculator shows me right then and there how it effects my taxes.

The best part about this app is that you can punch in all different scenarios to see how each one effects your tax liability. It's a great tool you can have at you access anytime you want to see how personal changes effect your year end tax liability.

TurboTax 2019 TaxCaster Taxpayer Data Tracking

Planning on making a donation, getting married, having kids, becoming self employed, signing up for education classes, contributing to a retirement account? they all effect your taxes.

The TurboTax TaxCaster Tax Calculator will track these changes and show you how they effect IRS income tax obligations.

TurboTax TaxCaster Taxpayer Income Tax Data Gathering and Tracking Checklist

click to print TurboTax TaxCaster checklist

This checklist is a detailed record of the documents and personal data needed which is used by the TurboTax TaxCaster Tax Calculator App to accurately calculate your income tax liability.

TaxCaster 2018 - 2019 Tax Season Users Guide

At this point we begin with the TaxCaster "my info" start screen that requests entries for age, marital status, and dependents. While the first two items are fairly simple, your answers for dependent questions pose a large influence on you tax calculations.

TurboTax TaxCaster Start Screen -- My Info

Do you have any children or dependents? A dependent is a person who entitles the taxpayer to claim a dependency exemption. Each dependency exemption decreases the amount of income subject being taxed. The term "dependent" means a "qualifying child" or a "qualifying relative."

  • The child has to have lived with you for at least half of the year.
  • The child has to be related to you as a son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, or a descendant of any of those.
  • The child must be 18 or younger at the end of the year, or under 24 if a student. To be a student, the child must have attended school full-time during at least five months of the year. The five months don’t have to be in a row.
  • The child must be younger than you (or your spouse, if married filing jointly), unless the child is disabled.

Rules for Claiming Other Relatives and Unrelated Persons as dependents. For a parent or other relative, there are different additional requirements:

  • The person cannot have a gross yearly income over an annually set limit
  • The person can’t be claimed if someone else that can claim them does.
  • The person must be either related to you or must have lived with you all year as a member of your household.

TurboTax TaxCaster Income Screen

This is where you enter your annual income, taxes already paid, stock sales and interest or dividend income.

  • Employee income / taxable wages
  • Self employment income or -
  • Business income
  • Unemployment income
  • Profits from stock sales
  • Interest and dividend income
  • Other types of income

TurboTax TaxCaster gathers this income data while it starts applying your counter balancing data in order to lower your overall taxable income. This in tern lowers the amount of taxes you owe.

Data gathered to drive your taxable income down includes:

  • W-4 Federal Employee Paycheck Withholdings
  • State Withholding
  • Self Employment Quarterly Payments

Your W-4 employee withholding is governed by the W-4 withholding form your employer has that dictates how many exemption you claim in order to lower the amount of taxes you pay from each paycheck.

Exemptions are used in combination to claiming dependents. By doing this the exemptions balance out the the tax advantage you get from having dependents so that your tax bill comes out close to even at year end. Not owing too much, or getting to big of a refund -- which means you gave Uncle Sam an interest free loan.

As these figures come together you can start to see a running positive (refund) or negative (taxes owed) balance as TurboTax TaxCaster presents this figure while it continues to change as additional data is entered.

TurboTax TaxCaster Tax Breaks Screen

This is where the meat and potatoes come into play to help get that tax bill whittled down as much as possible. Tax breaks are all those little things, "and sometimes substantial things"  that really do add up to a lot when it comes to cutting taxes.

First up is education expenses and the tax breaks that are available to qualified tax filers. The tuition and fees deduction for qualified education expenses can reduce a taxpayers taxable income by up to $4,000, even if you are not itemizing your deductions. The main deductible expenses include:

  • Tuition and fees paid
  • Student loan interest paid

You may qualify to deduct courses you take that maintain or improve skills required for your occupation. Also, if your employer or a government agency requires you to take courses you may also qualify for a deduction. In this case, you need to itemize. Reasons you would not qualify for a deduction include:

  • You’re above the IRS's income threshold
  • You're married and file separately.

How much you can deduct will be based on your modified adjusted gross income, MAGI. Software from TurboTax can help to determine if you’re eligible and TaxCaster can calculate how much you can deduct.

Now comes home ownership tax deductions. There are several changes in this area beginning with 2018 tax returns. The Tax Cuts and Jobs Act (TCJA) changes limit itemized deductions for personal state and local property taxes and personal state and local income taxes (or sales taxes if you choose that option) to a combined total of only $10,000 ($5,000 if you use married filing separate status). Individuals now can only deduct a maximum $10,000 of personal state and local property taxes — even if they didn't deduct anything for personal state and local income or sales taxes. Deductible expenses can include:

  • Mortgage Interest
  • State and Local Property Taxes
  • Home Office Expenses
  • Capital Gains From a Home Sale

The personal residence capitol gains exemption allows taxpayers who have lived in their property as a primary residence for two years out of the last five years to deduct $250,000 of profit tax free as a single person, or $500,000 as a married couple.

Additional tax deductions in the TurboTax TaxCaster tax breaks screen section include charitable contributions, and IRA, retirement fund contributions. For charitable contributions another top notch tracking tool is the TurboTax ItsDeductible App. And an IRA Contribution Calculator can help you determine how much you can invest tax free in your retirement account.

Next is the Review Screen and Future Forecast Screen

The review screen will show you how your data has been tallied up and the result of those calculations.

The future forecast screen compares the results from your current calculations to a projection for the following year to see how next years tax bill stacks up against your current tax year.

This TurboTax TaxCaster Forecast Feature allows you to move from getting a quick estimate of your current 2018 tax year refund or amount owed, to forecasting next years 2019 tax bill based on new tax reform laws that will take place in the following year.

The added ability to forecast next years tax bill based on the new tax reform laws happens to be one of my favorite features. It's a super convenient feature to be able to see what's ahead for tax planning purposes.

I’d encourage every person to spend a few minutes forecasting their new tax liability for 2019.

Thanks for taking time to check out our TurboTax TaxCaster App input data checklist and user guide.