Tax Preparation

The New Year is here, and that means it is also time to “ring in” a new Tax Season. Most people aren’t looking forward to this time of year, and Americans tend to procrastinate when it comes to doing their taxes (as evidenced by the overwhelming number of tax returns that get filed on April 15). But, for several reasons, you should consider getting organized early. The following outline is designed to let taxpayers like you know what information and documents to compile and help you find preparers that can help ensure the accuracy of your return. The best part is, there are several free resources that can assist you with early preparation.

While you are waiting for your W-2 to arrive before the end of January, there are still plenty of items to gather to be ready when official forms arrive in the mail. And while compiling all of the necessary information for 2016, we recommended starting a folder for 2017, too.

One suggestion is to buy two expandable folders with several pockets. This will allow a simple and cohesive place to keep all necessary documents. Pocket labels might include; Personal Information, Dependents, Income, Housing, Education, Healthcare, Charitable Donations, Miscellaneous, Tax Credits, and Completed Tax Return. One folder will be for 2016 and the other for 2017, to collect and organize receipts and statements throughout the year.



If you’re comfortable doing your own taxes and savvy with your online skills, is an excellent site. It will walk you through all the steps and there is no charge to complete forms or file taxes for people who earn $64,000 or less.

For those who prefer working with an individual and are looking for a free service, visit to find a free tax site near you. They also provide a checklist of items to bring to your first appointment.

You might want to consult a professional CPA for their tax preparation and filing. You can find a list of Montana CPA’s at

Finally, when there is a simple legal question, the Montana Legal Services Association provide free resources at  This helpful site can provide clarity for basic legal questions when there is doubt.



Personal Information

This is the most basic of all information to gather in preparation for completing tax forms. Gather social security numbers, identification, and addresses for all family members, including your dependents. It is also a great idea to have the previous years’ tax return.

If you decide to use a tax preparation service to assist with filing taxes, these organizations will often have an intake sheet or a questionnaire to complete, and that will guide you when completing your taxes. Ask before you make an appointment as these forms can definitely make the process more efficient for both parties.


You may qualify for tax deductions if you paid for childcare or before/after school care that was necessary for you or your partner to go to work. The childcare provider or school can provide an annual statement that can be used for tax purposes. Include the providers’ name and taxpayer identification number with your documents if it is not already listed on the statement.


Any and all income that was received during the year must be reported for tax purposes. This includes any job income as noted on your W-2 from your employer, as well as any miscellaneous income that will be stated on a Form 1099. Interest income from credit union or bank accounts or other saving accounts that are not specified for retirement, gifts over $14,000 from one person and alimony will also need to be reported. As income forms are mailed to you, simply put them in an expanding folder to have them handy and consolidated when needed.

Housing- Purchases, Sales, and Debt

For homeowners, there are tax deductions for interest paid as well as property taxes. And if you purchased a home or refinanced during the year, the costs for obtaining the mortgage may also be deductible. During the closing of a home or refinance, you should have received final documentation stating the costs of the loan along with the loan terms. This is sufficient documentation. For mortgage interest paid, Form 1098 will be mailed from the financial institution where the loan is held.

Each year, property tax forms are mailed to the homeowner, however, new copies can be requested if they have been lost. For MT taxpayers over the age of 62, property tax receipts or rent receipts are needed for tax preparation.


Both saving for education and paying for education are items to note in tax returns. During the year, had you contributed to a state-sponsored Education Saving Program (ESP), you’ll be able to claim that as a deduction on State taxes only, but still a deduction!

If anyone in the household attended a higher education institution, bring amounts paid, including tuition, equipment, and books.

If you’ve finished school and have student loans, the good news is that the interest on those loans can be claimed on a tax return. Form 1098-E will be mailed to you from the institution that holds the loan.


As part of the Affordable Healthcare Act (Obamacare), everyone is required to carry health insurance or there is a tax penalty assessed. Form 1095 is the documentation needed to prove health insurance coverage. If you’re covered by a plan purchased through the Health Insurance Marketplace, Form 1095 will be mailed to you. If you purchased a qualified plan on your own, directly through an insurance company, you will receive a Form 1095-B and should you be covered by your employer, they will provide a Form 1095-C. You only need to provide one of these forms.

Additionally, many people contribute to HSA’s and Flex Spending Accounts, either on their own or through work. If this applies to you, have the statements available that indicate the amount contributed and any withdrawals made during the year.

Finally, any medical or dental expenses that were not reimbursed or covered by insurance may be deductible. Gather any receipts showing out of pocket payments.

Charitable Donations

During the year, you might have donated to charitable organizations, such as churches, food banks and other non-profit organizations and these contributions may be tax deductible. It is customary for the organization to provide a receipt for the donation or an end of year statement if you made regular contributions during the year. The same applies for clothing and “goods” donations made to Big Brothers/Big Sisters, MS Society, Savers or other thrift shops that accept these items. When dropping off items, you were likely given a receipt – keep this! It’s for your tax return.


Tax preparation fees could also be deductible from your income. If you used a tax preparer, gather the receipt which indicates what you paid in 2016.

Tax Credits

There are several tax credits available to consumers, the key is knowing the requirements for qualification. Learn more about your tax credit options today.