Keep a folder in a place it won't get lost or misplaced. Every time you receive something you will need for your taxes put it in our folder. (EX. property taxes, donation receipts, etc.) then it will be handy, and in one place next year when you go do your taxes.
By Gail from Rochester, NY
Staying organized for tax time. Post your ideas.
I'm a bookkeeper, and keep my records very organized, but many people don't. My suggestion is to make use of the program that probably came with the software on your computer such as the Microsoft Money program.
This program is very easy to use, even for a beginner, and allows you to make entries just like you would in a checkbook register, and allocate them to different categories. You can set up different accounts like Cash, checking account, credit cards, etc. Every time you make a deposit into your checking account or write a check or use your debit card, you make an entry into the checking account register on your computer. IMPORTANT: For this to work, you must make all the same entries that you do in your manual checkbook register!
At the end of the year, you generate a report using this same software, and it will show income and expenses for the entire year under the appropriate categories, which makes tax preparation SO much easier. (You can also balance your checkbook each month on the computer VERY easily!) You can see at a glance how much you've earned and spent by category, and then all you need to do, with minimal effort, is transfer those amounts to your income tax form, or print out the report to give to your tax preparer. It really makes life much easier and tax time much less stressful!
Laura - Oceanside, CA
It is the dreaded tax season again, but my taxes will much easier to take care of. In my day planner, I have a plastic envelope, (pencil holder) that holds all receipts that should go on taxes. At home, I have attached, a bill binder (with months on tabs) to put all medical bills, medical visit receipts, all dental bills, etc. in the appropriate month. Taxes are now a breeze! You can forget that shoe box of information to dig through!
By Darlin Daisy
I set up a simple spreadsheet with sections for medical expenses, cash and goods donations, and other deductions. I add entries to this spreadsheet as they arise all year long. Then, at tax time, I just print off a copy and I have a one-page summary to use in completing my tax forms. It saves a lot of time and paper-shuffling. I file this printout with my other tax documentation. Then, after tax season, I copy the spreadsheet into a new document, remove all the entries, change the date, and I'm ready to start the process all over again for the following year.
I've used My Tax Records (from www.GetOrganizedHere.com) the past two years. Definitely keeps everything organized and helps make sure I don't forget anything important!
I use a portion of my home for business and I can deduct a portion of my utilities, home improvements, and purchases pertaining to the business from my taxes.
With the tax season already behind us (almost!), here are a few suggestions I have to make next year's preparations a bit easier.
Here are some tips from the IRS about keeping good records. You can avoid headaches at tax time by keeping track of your receipts and other records throughout the year.
I organize my tax papers in a binder using clear page protector covers and with labelled dividers to keep the categories separate and organized. Each time something for tax comes in it is placed in the binder in the correct division.
This is the time to get organized for your 2008 taxes. Start the year off right! Then at this time next year, you will have all you need.
Every January I set up a new manila folder and mark it with the year. Then every time I have a receipt or statement I need to save, I just put it in the folder.
Tax records were always a problem for me. I now use an accordion file folder with 12 slots. I use one for each month. I keep it next to my computer since I do most of my bills on line.
An easy way to keep tax information together is to use one of the free calendars that stores give away. I white out Sunday on the Sunday column and combine Saturday/Sunday under one column at the end.
Start out this month preparing for next year's tax time! Label 12 business-size envelopes (one for each month), and put all your receipts in the respective envelopes.
I use a monthly calendar to organize my financial life. I don't use a fancy one, just one that I receive as a promotional free item.
A very helpful publication can be found at the Internal Revenue Service web site. www.irs.gov, It is Publication 552 and it is all about record keeping. I recommend downloading a copy and putting it in front of your file box.
When I get my first tax document in the mail (1099, W-2, etc.), I designate a drawer near my computer as my "tax documents drawer" and let everyone who handles the mail know.