Tax 2004: Refund Spending

Check List for Tax Prep

Review last year's return for any items that could be carried forward. The possibilities include capital losses from sales of investments on Schedule D, which lists gains and losses from sales of stocks, shares of mutual funds and other investments, or a net operating loss from the operation of a business that was claimed on Schedule C.

For example: Suppose you had losses on sales of stocks or mutual funds in 2002. The cap on a deduction for capital losses might have barred a write-off of the entire loss on your return for 2002; after an offset against capital gains, no more than $3,000 of additional capital losses can be subtracted from ordinary income, such as salaries or pensions. But you can apply any unused 2002 losses against capital gains for 2003, as well as apply any remaining losses against as much as $3,000 of ordinary income.

Make sure to firmly attach all required schedules and statements to your 1040 — say, Schedule D or Schedule A, on which you itemize deductions for such outlays as medical expenses, real estate taxes, state and city income taxes, and mortgage interest.

Include your name and Social Security number on any IRS schedules or your own statements. Should the schedules become separated from the return, it will be easier for the IRS to reassemble everything.

Use the pre-addressed envelope that came with your return. If you do not have one, or if you moved during the year, mail the return to the IRS Service Center for the area where you now live.