Starting your taxes? There's probably a pile of 1099 forms for you to go through. Here's how to avoid increasing your 2017 taxes by being misled by these.
First of all, don't lose any, of course: The IRS gets a copy of each, so if your return is missing one or more, that's going to be a headache.
Number two: They may show a lot of money that looks like income. But often, it's totally tax-free. Make sure you categorize it right. Here are three you might see:
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The 1099-G
1099-Gs are for government payments. Most of you – those who claimed the standard deduction last year, or if you took the state sales-tax deduction – can totally ignore ones that are for state income tax deductions. Even if you itemize, part of the refund may be tax-free.
The 1099-Q
1099-Qs are for payouts from education accounts like a 529 college plan. Since education is pricey, these numbers could be big. But so long as you used that money for tuition or other qualifying expenses, it's tax free.
The SSA-1099
For sure, some of your Social Security benefits are tax free. For lower-income taxpayers, all of it is. Check out IRS publication 915 to get the details on the SSA-1099, or let your tax-prep software figure out the calculations.
There are other kinds of 1099s. See 7 Tax Forms That Can Accidentally Increase Your Tax Bill for more on how to handle them.
-
Here's How To Get Organized And Work For YourselfWhether you’re looking for a side gig or planning to start your own business, it has never been easier to strike out on your own. Here is our guide to navigating working for yourself.
-
How to Manage Risk With Diversification"Don't put all your eggs in one basket" means different things to different investors. Here's how to manage your risk with portfolio diversification.
-
Kiplinger's Tax Map for Middle-Class Families: About Our Methodologystate tax The research behind our judgments.
-
Retirees, Make These Midyear Moves to Cut Next Year's Tax BillTax Breaks Save money next April by making these six hot-as-July tax moves.
-
Estimated Payments or Withholding in Retirement? Here's Some GuidanceBudgeting You generally must pay taxes throughout the year on your retirement income. But it isn't always clear whether withholding or estimated tax payments is the best way to pay.
-
How to Cut Your 2021 Tax BillTax Breaks Our guidance could help you claim a higher refund or reduce the amount you owe.
-
Why This Tax Filing Season Could Be UglyCoronavirus and Your Money National Taxpayer Advocate Erin M. Collins warns the agency will continue to struggle with tight budgets and backlogs. Her advice: File electronically!
-
Con Artists Target People Who Owe The IRS MoneyScams In one scheme, thieves will offer to "help" you pay back taxes, only to leave you on the hook for expensive fees in addition to the taxes.
-
Cash-Rich States Lower TaxesTax Breaks The economic turnaround sparked a wave of cuts in state tax rates. But some say the efforts could backfire.
-
The Financial Effects of Losing a SpouseFinancial Planning Even amid grief, it's important to reassess your finances. With the loss of your spouse's income, you may find yourself in a lower tax bracket or that you qualify for new deductions or credits.
