Income: Uncover Your Financial Canvas

In the Income module, we delve into the various streams that contribute to your financial tapestry. This section ensures you account for all forms of income, leaving no stone unturned when it comes to tax considerations. Here’s what to expect:

Wages and Salary:

Input your employment earnings, ensuring accuracy in reflecting what you've earned from your job.

Tax Form: W-2 (Wage and Tax Statement)

Details: Your employer provides this form, summarizing your annual earnings, federal and state tax withholdings, and other relevant details.

INSTRUCTIONS:

https://www.irs.gov/pub/irs-pdf/iw2w3.pdf

Self-Employment Income:

If you’re your own boss or engaged in freelance work, declare your self-employment income accurately.

Tax Form: 1099-NEC (Nonemployee Compensation)

Details: If you're self-employed or a freelancer, clients issue a 1099-NEC to report income. Keep track of all payments received.

INSTRUCTIONS:

https://www.irs.gov/pub/irs-pdf/i1099mec.pdf

Rental Income:

Own property? Report rental income and expenses associated with your real estate holdings.

Details: Report rental income, expenses, and depreciation on Schedule E. Documentation for mortgage interest, property taxes, and other expenses is crucial.

INSTRUCTIONS:

https://www.irs.gov/taxtopics/tc414 https://www.irs.gov/pub/irs-pdf/i1040se.pdf

Investment Income:

Report income generated from your investments.

Tax Forms:

1099-DIV (Dividends and Distributions)

1099-INT (Interest Income)

INSTRUCTIONS:

https://www.irs.gov/pub/irs-pdf/i1099int.pdf https://www.irs.gov/pub/irs-pdf/i1099div.pdf https://www.irs.gov/pub/irs-pdf/i1099b.pdf

Business Income:

For entrepreneurs, report your business income, deductions, and credits to maximize tax benefits.

Tax Forms:

1099-MISC (Miscellaneous Income) for non-employee compensation

Details: Use Schedule C for reporting business income and expenses. Track all income, including 1099-MISC payments.

INSTRUCTIONS:

https://www.irs.gov/pub/irs-pdf/i1040sc.pdf https://www.irs.gov/pub/irs-pdf/i1099mec.pdf

Other Income Sources:

Tax Forms: Varies (e.g., 1099-MSA for Medical Savings Account distributions)

Details: Depending on the income source, different forms apply. Gather relevant documentation for alimony, royalties, and other miscellaneous earnings.

INSTRUCTIONS:

https://www.irs.gov/pub/irs-pdf/i1099sa.pdf