Tips from our members - GILBERT MERCADO - MONEY CONCEPTS

Recordkeeping
Well-organized records make it easier to prepare a tax return and help provide answers if your return is selected for examination or to prepare a response if you receive an IRS notice. 
Records such as receipts, canceled checks and other documents that support an item of income or a deduction, or a credit appearing on a return must be kept so long as they may become material in the administration of any internal revenue law, which generally will be until the period of limitation expires for that return. For assessment of tax you owe, this generally is 3 years from the date you filed the return. Returns filed before the due date are treated as filed on the due date. 
In tax years 2014 and later, you should keep records of your own and your family members’ health care insurance coverage, including records of employer provided coverage or premiums paid and type of coverage for private coverage, so you can show that you and your family members had and maintained required minimum essential coverage. If you are claiming the premium tax credit, you will need information about any advance credit payments you received through the Health Insurance Marketplace, the premiums you paid, and the type of coverage you obtained at the Marketplace. If you or any of your family members are exempt from minimum essential coverage, you should retain certificates of exemption you may receive from the Marketplace or any other documentation to support an exemption claimed on your tax return. 
If you have employees, you must keep all your employment tax records for at least 4 years after the tax becomes due or is paid, whichever is later. For more information, see Publication 15, (Circular E), Employer’s Tax Guide. 
Visit www.irs.gov for Publication 583: Starting a Business and Keeping Records and Publication 462, Travel, Entertainment, Gift, and Car Expenses for additional information on required documentation for taxpayers with business expenses.   Always remember your qualified tax preparer must sign on your tax return.  For additional information, please contact me at 830-775-4800.

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