Reporting income to IRS or certain transactions that IRS has notified as reportable transactions during the calendar year is a legal obligation for persons engaged in a trade or business, including a corporation, partnership, individual, estate, or trust. The tax law makes it compulsory for the information filers to also furnish a copy to you. Therefore, this tax season 2023, check your mailboxes or inboxes to see if you have received reporting documents.
Why consult forms reporting income to IRS?
The obvious answer is that the IRS a revenue cop! Since IRS gets one copy of the forms issued by the payers, these data will be used to check if those income or transactions are reflected in your tax return. Suppose the IRS return processing system finds any discrepancies or shortcomings in verification with the income reporting forms data. In that case, they will issue a notice /letter, or your tax return may be selected for IRS audits, leading to tax evasion charges with penalties and prosecution. Therefore, when you file your tax return for the year 2022 (tax season 2023 ), you must consult these income reporting documents because when IRS processes the tax return, the data about transactions is already with IRS.
Quick video on sixteen forms reporting income to IRS?
List of 16 forms reporting income to IRS?
Here is a list of sixteen tax forms or documents you must watch for and use for filing taxes for 2022.All the forms may not relate to all the persons as these are issued for different purposes in varied situations.
1. Form W-2 – If you were employed in 2022, this form w-2 reports your wages and tax withheld from your paychecks, which will be a credit against your tax liability.
2. Form W-2G – This form reports gambling winning in 2022 exceeding a threshold. Refer to this form to declare your correct winnings in your tax return for 2022.
3. Form 1099-G – This form is used for reporting income and refunds from several sources, including:
- If you received a state income tax refund in 2022 from your 2021 return
- If you received any unemployment benefits in 2022, which are taxable for federal purposes. Some states also tax these payments.
4. Form 1099-MISC – You may receive a Form 1099-MISC for miscellaneous income received during 2022. This income will need to be reported on your tax return, but in some cases, expenses may be deductible against this income.
5. Form 1099-DIV – As the name suggests, this form reports dividends received by you.
6. Form 1099-INT – This form is for reporting interest paid to you by banks or IRS.
7. Form 1099-B – Where you sold securities during 2022, you should receive a 1099-B providing all the details of your sales for the year.
8. Form 1099-S – If you sold your home during the year, you might receive a Form 1099-S showing the sales price. Sometimes the escrow company issues the 1099-S at the sale’s closing, so check your closing documents to see if you already have the form.
9. Form SSA-1099 – Social security benefits received by you during 2022 is reported on the Form SSA-1099 showing the amount received, any social security benefit adjustments, and the amount of Medicare insurance premiums withheld from your monthly benefits.
10. Form RRB-1099 – Is the equivalent of Form SSA-1099 for railroad retirement benefits.
11. Form 1099-R – Reports retirement plan benefits you received, including IRA distributions. Generally, the taxable amount is also included on Form 1099-R.
12. Form 1098-T – If you paid college tuition for yourself or a dependent, you would generally need the Form 1098-T that will be sent to you by the educational institution to claim an education credit.
13. Form 1095-A – If you obtained your health insurance through a government marketplace, you should receive a Form 1095-A that is needed to reconcile your advance premium tax credit and used to reduce your 2022 premiums.
14. Form 1099-NEC – If you were self-employed in 2022, businesses that paid you $600 or more will be issuing you a Form 1099-NEC, some even if the amount they paid you is less than $600.
15. Form 1099-K – If your business accepts credit cards, debit cards, and PayPal or other third-party payments, you may receive a Form 1099-K showing those sales for the year.
16. Schedule K-1 – You will also receive a Schedule K-1 from the entity, a partner in a partnership, a shareholder in an S-Corporation, or a trust beneficiary, showing information from the entity.
Homework on these forms reporting income to IRS will also give you confidence about the correctness of the tax return filed this tax season 2023
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