To track your tax deductions and other tax-related data using Money, you simply need to categorize any tax deduction or other tax item using an appropriate category. For example, if you write a check to pay your real estate property taxes—this is a deduc-tion for both federal and state income tax returns—you need to use a category that tracks this amount. By doing this, you can produce a year-end report that summarizes the amounts you have spent in this “real estate property tax” category, and that total
goes on your tax return.
One warning is in order here, however. For many income and deduction amounts, you must use the amount reported on the informational return supplied by the person paying the amount or receiving the amount. For example, don’t use your records of wages for reporting your wages on a tax return. You need to use the wages informa- tion supplied on the return provided by your employer. For wages information, this informational return is the W-2 you receive after the new year starts. Similarly, many other income and deduction amounts need to come from the informational returns—
not your Money records. If there is a disagreement between your Money records and the informational return, you need to either assume the return is correct and go with that number, or perhaps, using your Money records, contact the person or firm that supplied the return and get them to issue a corrected return.
How do I summarize my tax data?
Money’s Reports window includes a Tax Reports category that supplies all the reports you need or will want for tax planning and preparation. To display this list of tax-re- lated reports, click the Taxes link and then choose Tax Reports. Money displays the Pick A Report Or Chart window. The first three reports
summarize tax-related transactions, capital gains, and loan interest, respectively. The fourth report summarizes tax-related data by Internal Revenue Service form. You can use this information to complete paper-based tax return forms or in tax preparation software.
Money supplies a calculator you can use to estimate your taxes. To use this calculator, click the Taxes link and then choose Tax Estimator. When you do this, Money dis- plays a form you can use to provide information about your tax situation and estimate what you owe or will owe in taxes for the year.
How do I export tax information?
To export tax deduction data from Money to your tax preparation program, you pro-duce a tax software report. To do this, click the Taxes link and then select Tax Reports so that Money displays the Pick A Report Or Chart window. Then double-click Tax Software Report. To complete the process, simply review and use the information as appropriate.
Here’s another warning: You probably don’t want to export tax deduction data from Money’s tax preparation program. You need to supply only a half a dozen to a dozen numbers anyway. In many cases, these numbers must come from the informational tax forms supplied by the payer of some amount for the recipient of some deduction. They shouldn’t come from your Money records.
