Retaining copies of your federal tax return is important. In fact, you may not even realize just how important it is until you are required to present a copy of your return and it’s no where to be found. Not only will you need the return in case of audit, but the tax return is often used to secure student aid, obtain loans, purchase a home or business, and more.
So, what are your options if you cannot find a copy of your tax return?
E-filed tax returns have their data stored in software. One of the benefits of e-filed tax returns is that there is a digital copy of your tax information. If necessary, another digital copy could be produced.
“If you paid a professional to prepare your tax return, you should be able to get a copy from him,” says Associate Partner Julie Strohlein, CPA.
Adds Manager Chris Cicalese, CPA, MSTFP, “When receiving a tax return from a paid professional you should request to have any information such as a social security number or employer identification number masked. This will help prevent identity theft if you misplace your tax return.”
IRS requested transcript. The IRS can provide you with a transcript of your current tax return or transcripts from the prior three years. To request a transcript from the IRS using their online tool, go to www.irs.gov and search for their “order a transcript” tool. Information will be provided to you within approximately 5 to 10 business days.
But don’t always rely on this! Per Julie, the IRS changes the exact procedures for requesting transcripts from time to time as they constantly strive to limit identity theft and fraud.
Request an actual copy. If you require an actual copy of your tax return, one can be provided for $50 by filling out Form 4506. But plan accordingly, as it can take up to 75 days to process your request.
Copies of informational returns. If you are missing a W-2 or 1099, you can also contact the company that originally issued the tax form. They will have these forms on record for their own audit purposes.
Copies sent to third parties. Your request for transcript can also be sent to a third party with your authorization. If you wish to take this route, please note that you may lose some control as to who has this personal information.
Understand the different transcripts. When making a request for a transcript from the IRS, you need to understand what you are requesting.
Return transcript. This includes most of the lines of your tax return as originally filed.
Account transcript. This is the status of your tax account. It includes any balance owed on your account, record of any payments, and adjustments after the return was filed.
Record of account. This is a combination of the return transcript and the account transcript.
“It is important to know how the information will be used so that you request the correct transcript,” recommends Julie. “For instance, a bank may want to see the return transcript in order to verify the amounts and types of income you earned. If you are trying to settle a discrepancy with the IRS, however, you might need an account transcript to compare the tax payments you paid with the ones that the IRS credited to your account.”
If need be, you can also request a verification of non-filing of a tax return.
The format in which you save copies of your tax returns is a matter of personal preference. You should use the same care to protect your sensitive information for any storage method. If you keep paper copies, keep them in a locked drawer or cabinet. Digital copies on CDs, flash drives, or saved on your computer should be password protected at the very least, and preferably encrypted as well.
You should limit the people who see your social security number at all times. If the person requesting a copy of your return does not absolutely require seeing your entire number on the forms, you should send copy that has your social security number masked or blacked out. Contact your Alloy Silverstein CPA if you have questions.
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The information contained in this newsletter is of a general nature and should not be acted upon in your specific situation without further details and/or professional assistance. For more information or for assistance with any of your tax or business concerns, contact our office at 856.667.4100.
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