Getting ready for taxes: Review this list first

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Wouldn't you rather be watching television — or doing something else that you enjoy — on the evening of April 15 instead of rushing through your tax forms to make a midnight postmark? By organizing your tax information now, you may be able to relax a bit in April.
Before grabbing a calculator or visiting a tax professional, make sure you have the information described below (certain items may not apply to you). For help preparing your taxes, visit a tax professional or the IRS Web site.

Sources of income

  • Forms W-2 from employers
  • Receipts from odd jobs, rents, or other income
  • Evidence of pension or disability payments
  • Proof of unemployment compensation if you collected it
  • Forms 1099 from anyone for whom you performed work on a contract basis

Investment income1

  • Documentation of your contribution to an Individual Retirement Account (IRA) — you may be able to deduct your contribution to a traditional IRA if you meet income thresholds
  • Forms 1099 — which detail yearly gains or losses — if you own mutual funds in taxable accounts
  • Year-end statements from brokerage accounts in which you hold stocks or bonds
  • Year-end statements from companies in which you own stock and receive dividends
  • Year-end bank statements that detail interest income

Potential deductions

  • Documentation of mortgage interest
  • Evidence of charitable contributions
  • Receipts for payments of college tuition and student loans (if you meet income thresholds)
  • Paperwork detailing educational expenses for yourself or a family member (if you meet income thresholds, you may qualify for the American Opportunity Tax Credit)
  • Documentation of job hunting expenses
  • Evidence of unreimbursed business expenses, such as subscriptions to trade publications or membership in professional associations
You may deal with tax issues not mentioned here, but this list can give you a good running start in your tax preparation. If you do as much as possible now, you may enjoy some free time on April 15 instead of standing in line at the post office.

1If you have incurred losses in taxable investments, consult a tax professional to determine whether you can use these losses to offset taxable income.

Neither Merrill Lynch nor any of its affiliates or financial advisors provide legal, tax or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions.

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