Guide to Completing Your 2025 Individual Tax Return with Collective

This guide walks you through the 2025 Individual Tax Return (ITR) flow in your Collective dashboard, helping you understand what information is needed and why it matters. Personal factors like having children, owning a home, or making outside investments, directly impact your tax filing needs. 

How the Process Works

The first step is answering a few questions in your dashboard so we can tailor the right individual tax return package for you & your household. 

Once your package is built, we’ll notify you of next steps once the IRS opens the filing season (last week of Jan 2026). There are four key steps to preparing your return:

1. Confirm information: Ensure your household details are up to date for your tax return.
2. Tell us about your activity and upload documents: Share your household activity and relevant tax forms.
3. Preparation: Our team will use this information to prepare your draft individual tax return.
4. Review, Approve, and Sign: Once the draft is ready, you will need to review and sign it so it can be filed.

2025 Walkthrough of the Individual Tax Return Organizer

Completing your Individual Tax Return (ITR) Organizer is a critical step in ensuring your individual tax return (Form 1040) is accurate. This helps us gather necessary details about your activity outside of your business to provide a complete financial picture.

1. Personal Information

The foundation of your return depends on your status as of December 31st of the tax year.

• State of Residence: If you moved states during the year, you will likely need to file in both states, but list the state where you lived at the end of year. 
• Filing Status: Your status is determined by your situation on the last day of the year. For example, if you were married in July, you are considered married for the entire tax year.
• Head of Household: This typically applies to single parents or individuals supporting a qualifying dependent (like a parent) who lives with them most of the time.
• Dependents & Newborns: If you are waiting on a Social Security Number (SSN) for a new dependent, please reach out to our team via your Message Center. An accurate SSN is eventually required by the IRS to claim related credits.

2. Outside Income & Work Activities

We need to know about income earned outside of your Collective business to ensure your total tax liability is calculated correctly.

• W-2s and 1099s: You only need to report W-2s from employers that are managed outside of Collective payroll. If you receive a 1099 for income already included in your Collective books/accounting, please let our team know so that we can ensure it’s recorded appropriately.
• Investments & Crypto: Report all interest, dividends, and sales of stock or cryptocurrency. If an exchange no longer exists, provide any documentation you have regarding the original purchase or sale.
• Retirement Withdrawals: If you took money out of an IRA or 401(k), let us know, especially if the funds were used for specific needs like a first-time home purchase or medical emergencies, as these may qualify for penalty exceptions.

3. Deductions & Credits

Most Collective members get the most benefit from the IRS’ standard deduction. However, the organizer asks for specific details to see if itemizing your deductions would save you more money, so you’re getting the most optimized version of your tax return. This may be relevant if your combined expenses in these categories are high:

• Childcare Expenses: If you paid for childcare while working or looking for work, you may be eligible for a tax credit.
  • Pro Tip: Request a Form W-9 from your provider. You will need their SSN or Employer Identification Number (EIN) to claim the credit.
• Home & Property: This includes property taxes, mortgage interest, and any points or upfront fees paid during a refinance to lower your interest rate for your primary residence
• Vehicle Fees: When reporting car registration, only include the specific registration fee (usually a separate line item on your DMV receipt), rather than the total amount paid.
• Medical & Dental: Include out-of-pocket expenses not covered by insurance. These are generally deductible only if they exceed a certain percentage of your adjusted gross income.
• Charitable Giving: Keep records of all cash and non-cash donations made throughout the year.

4. Retirement & HSA Contributions

• Retirement Deadlines: Employee contributions to a 401(k) must generally be processed through payroll by December 31st. However, certain employer contributions or IRA contributions may be made up until the tax deadline.
• Excess Contributions: If you contributed more than the annual limit to a retirement account, notify your tax expert immediately. You may be able to work with your provider to withdraw the excess and reduce potential penalties.
• Confirmation: If you aren't sure how much more you can contribute for the year, check the "confirm" box in the organizer. Your tax expert can provide the maximum amount based on your reported income.

Critical Deadlines

Extension Deadlines

In most cases, requesting an extension provides more flexibility to prepare your return. Note that an extension to file is not an extension to pay any taxes due. Any tax balance due is still due by April 15 2026. 

• Apr 15, 2026: Deadline to pay any taxes due, regardless of extension.
• Sep 30, 2026: Last day to submit your completed individual organizer and documents.

• October 15, 2026: The official individual extension filing deadline.

   

Disclaimer: The information contained in this document is provided for informational purposes only and should not be construed as legal, financial, or tax advice. It is not intended to be a substitute for obtaining legal, accounting, or other financial advice from an appropriate and/or licensed adviser, or for the purpose of avoiding U.S. Federal, state or local tax payments and penalties.