Why Having the Right Documents Matters

The quality of your tax return depends on the information your advisor receives. When documents are missing, incomplete, or unclear, deductions get overlooked, income gets misreported, and opportunities for tax savings disappear. Providing accurate documents also protects you during an audit because everything is documented and verified. In 2025, with increased IRS matching, digital reporting, and stricter compliance standards, submitting the correct documentation is more important than ever.

This guide outlines the exact documents your tax advisor needs to file accurately and legally reduce your taxes.

Documents Every Taxpayer Should Provide

W2s

If you worked as an employee at any point during the year, every employer must issue a W2. Even short-term or part-time jobs must be included. Missing a W2 creates IRS mismatches.

1099 Forms

There are several types, including:

• 1099-NEC for contractor income
• 1099-MISC for miscellaneous income
• 1099-K for digital payment platforms
• 1099-INT for interest income
• 1099-DIV for dividends
• 1099-B for brokerage activity
• 1099-R for retirement distributions

Self-employment, investments, and side hustles require accurate 1099 reporting to prevent IRS notices.

Social Security or Pension Statements

SSA-1099 forms outline retirement, disability, or survivor benefits. Pension distributions must be reported as well.

Health Insurance Forms

Depending on your situation, you may receive:

• Form 1095-A for marketplace insurance
• Form 1095-B or 1095-C from employers or private plans

This verifies coverage and determines whether health insurance credits apply.

Documents for Self-Employed Individuals

If you operate a business, freelance, or receive 1099 income, your advisor needs complete records.

Income Records:

• Total revenue from all sources
• Payment processor statements
• Platform income reports
• Invoices and receipts

Expense Documentation:

• Mileage logs
• Home office details
• Equipment and supply receipts
• Phone and internet bills
• Software and subscription charges
• Advertising and marketing
• Travel and meals
• Contractor payments
• Professional fees

Accurate expense tracking directly reduces taxable income.

Business Financial Statements:

• Profit and loss statement
• Balance sheet
• Bank statements
• Credit card statements
• Loan statements

If you do not have these, your advisor can help create them, but the documents must be complete.

Payroll Documents for S Corporation Owners:

• Payroll summary
• W2s issued to owners
• W3 summary
• 941 quarterly filings
• Year-end payroll reports
• State payroll filings

S corporation returns require proper payroll documentation because reasonable compensation is a key IRS requirement.

Documents for Real Estate Owners and Investors:

• Rental income documentation
• Lease agreements
• Mortgage interest statements (Form 1098)
• Property tax receipts
• Insurance records
• Utility payments
• HOA fees
• Maintenance and repair receipts
• Management fees
• Advertising expenses
• Settlement statements (if you bought or sold property)
• Depreciation schedules

Real estate tax strategy depends heavily on accurate expense and depreciation reporting.

Short Term Rentals:

Short-term rental operators must also provide:

• Platform activity reports
• Cleaning and turnover costs
• Occupancy records
• Materials and furnishing costs
• Utilities and WiFi
• Supplies

Short-term rental tax treatment requires clear records to determine whether losses may offset other income.

Documents Related to Major Life Changes:

• Marriage or divorce decree
• Birth certificates of dependents
• Adoption paperwork
• Home purchase or sale documents
• Vehicle purchase or sale documents
• Inheritance paperwork
• Medical expense documentation

Life changes directly influence filing status, credits, and deductions.

Investment and Brokerage Documents:

• Form 1099-B for stock sales
• Dividend and interest statements
• Crypto transaction summaries
• Proof of cost basis
• Year-end brokerage statements

Crypto traders must provide complete transaction history because platforms rarely calculate tax-ready totals.

Retirement Contributions and Accounts:

Statements for:

• Traditional IRA contributions
• Roth IRA contributions
• Solo 401(k) contributions
• SEP IRA contributions
• Employer 401(k) contributions
• HSA account funding

These documents determine deduction eligibility and contribution limits.

Charitable Contribution Records:

• Cash donations with receipts
• Non-cash donation values
• Vehicle donation documents
• Acknowledgment letters for donations over IRS thresholds

Without documentation, contributions cannot be deducted.

Education-Related Documents:

• Tuition statements (Form 1098-T)
• Student loan interest (Form 1098-E)
• Educational expense receipts

These determine eligibility for education credits and deductions.

Medical and Dental Expense Documentation:

• Receipts for major medical payments
• Insurance premium statements
• Out-of-pocket expenses
• Long-term care insurance

Medical deductions apply only above certain thresholds, so documentation must be precise.

Why Tax Advisors Need These Documents Early

Early submission helps your tax advisor:

• Identify deductions
• Structure income correctly
• Avoid IRS mismatches
• Optimize credits
• Analyze entity structure
• Plan for QBI
• Review payroll
• Evaluate depreciation
• Prepare adjustments

The earlier your documents are provided, the more strategy can be applied.

Common Problems When Documents Are Missing:

• Misreported income
• Missed deductions
• Incorrect depreciation
• Understated expenses
• Overstated income
• IRS notices
• Delayed filing
• Inaccurate QBI calculations

Most issues arise simply because documents were not forwarded or were incomplete.

How AE Tax Advisors Handles Documentation

AE Tax Advisors provides clients with a structured checklist, secure portal, and organized workflow to collect every necessary document. The firm reviews documents for accuracy, verifies amounts, and builds a strategy around your financial data to reduce your tax bill legally.

Final Thoughts

Tax filing becomes faster, easier, and less stressful when you know which documents to provide and why they matter. The more complete your records are, the more opportunities your advisor has to reduce your taxes and keep you compliant. In 2025, proper documentation is the foundation of every strong tax strategy.

For high-income individuals who want a strategic partner steering their tax planning, more information is available at AETaxAdvisors.com.

Disclaimer: The information provided in this article is intended for general informational purposes only and does not constitute professional financial or tax advice. Tax laws and regulations can vary depending on your individual circumstances, and this article is not intended to replace the guidance of a licensed tax advisor. Always consult with a qualified tax professional to ensure compliance with current tax laws, accurate filing, and to address any specific questions regarding your personal tax situation.