Preparing your taxes can be daunting and stressful, especially since the average person is not an expert on tax rules. So here are some basic tax preparation tips to help make your tax preparation go a little more smoothly.

Choosing the Right Forms

Everyone needs to file some type of form 1040. There is the 1040EZ form, the 1040 or the 1040A form. 1040EZ is for people whose income is less than $50,000 annually and earned interest is less than $400. It also the form to use for people who are not itemizing deductions, who do not have dependents, who are not blind or over sixty-five. The 1040A is for those whose income is less than $50,000 and do not need to itemize deductions. The 1040 form is for everyone else.

There are various other forms known as schedules that are also often needed in conjunction with the 1040 forms. Schedule A is used to itemize deductions, schedule B is used to report taxable interest or dividends greater than $400, schedule C or C-EZ is used to report business profits or losses, schedule D reports capital gains and losses, schedule E reports supplemental income and losses, and schedule EIC is used to claim earned income tax credit.

Gather What You Will Need to Fill Out the Forms

There are numerous papers, forms and quite a bit of information that is needed to prepare a tax return. Even if you are not preparing your own taxes you will need to provide these things for the person that is.