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Tax Guide 2004

Careful With the Paperwork How to Get Organized for Tax Time
By Julian Block
Special to

Feb. 2 Many refund delays, time-consuming correspondence and audits are triggered by a taxpayer's carelessness. Here are some reminders about items to check in advance of filing your return, along with some steps to take afterward.

Start With the Basics

Check the package of paperwork sent by the IRS. First read the instructions to make sure you have all necessary forms. If not, they are easily available through several channels. To get them by mail, call 800-829-3676. For forms by fax, call 703-368-9694. Or download copies at on the Web.

Whether you should fill out the 1040 yourself or hire someone depends on how complicated your finances are. For instance, does your income derive mainly from salaries, with some interest from savings and dividends from stocks and mutual funds?

And do you claim either the no-proof-required standard deduction or simple-to-calculate itemized deductions for charitable contributions, real estate taxes, mortgage interest and state income taxes? Then you probably are able to file without paid help or with free help available from numerous taxpayer-assistance programs AARP, for instance.

Do you have income from, say, rental properties or partnerships or do you operate your own business, whether on a part- or full-time basis? Then you might need an accountant or other qualified professional.

If you choose to use a paid preparer, arrange to meet as early as possible during the filing season. For a first-time meeting, bring along prior returns. In some cases, reviewing past filings uncovers miscues that require amending or ways to trim the tab that you might now be overlooking.

Mistakes tend to repeat themselves; you can go back three years to correct errors, with the recalculating done on Form 1040X. Changing a federal return might also require amending a state return. In that event, file your state's version of the Form 1040X.

Scour personal records, including checkbooks, credit-card statements, receipts, appointment calendars and bills for 2003 and returns for 2002. Your objective: to search for forgotten deductions, especially if you run a business.

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