All American citizens who are employed by a business or self-employed and meet the IRS requirements are required to file a tax return. A tax return will state any income you made for the year, any deductions you are entitled to, any tax credits allowed to you and any monies you may owe to the government. Almost all types of income you receive throughout the year are required to be reported on your tax return.
Wages that you earn throughout the year must be reported on your tax forms. This type of income includes any monies made from any services that you have provided in relation to your occupation. It is required that your employer must withhold income from your wages for Medicare, Social Security and income tax. A W-2 form must be placed in the mail no later than January 31st of each year from your employer. This W-2 form is necessary to report your wages on your tax return. Self-employed individuals are also required to report wages to the federal government. Those who are self- employed need to keep accurate records of any income and may be required to report income and pay taxes to the IRS on a quarterly basis.
The federal government requires that you must report any interest payments that you received as income. These types of payments come in the form of interest earned on savings and bank accounts, retirement accounts, any royalties received from a business and any interest received from business investments. Any form of income that is received as investment interest or a dividend is considered taxable income that also needs to be reported on your tax filings. Companies that issue payments on these forms of interest must send you a 1099 form which can differ in relation to the types of interest you are receiving. If you earn more than $10 in any sort of banking account, you will be issued a 1099 but any funds received as interest must be reported, even those under $10.
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When receiving Social Security benefits, it may be necessary to report those benefits to the IRS while filing your tax returns. Starting in 2011, the Social Security benefits must be reported that includes any other above related income totaling your return above $25,000 as an individual and $32,000 as a married person. You will want to use either a 1040 or 1040A form to report this type of income.
This type of income includes any funds that you do not receive on a regular basis. Examples include funds received for hosting a party, life insurance or death benefits, unemployment and any contributions made through a campaign. For instance if you sell a piece of jewelry on EBay, you are required to report the proceeds as income. The fees charged by EBay are for use of their service, not for purposes of paying taxes. Or if you win a gift card in a raffle, this money is also to be reported as income. All of these types of random income must be reported to the IRS.