Tax reporting is the process of documenting and submitting financial information to the government for tax purposes. Individuals and businesses must report their income, expenses, and other relevant financial data to determine their tax liability. This information is typically submitted through forms such as the IRS Form 1040 for individuals or the IRS Form 1120 for corporations in the United States. Accurate tax reporting is essential to ensure compliance with tax laws and avoid penalties. It often involves gathering various documents, such as W-2 forms for employees or 1099 forms for independent contractors, to provide a complete picture of one's financial situation.