Uncle Sam is Ready...Are You? Organizing Tips for Tax Time

Anyone who is closely related to an accountant knows that there are not four, but five seasons in a year: Spring, Summer, Fall, Winter, and 'Tax Season.' During the other seasons, we accumulate leaves, snow, and mosquito bites. During 'Tax Season' we accumulate paper. And more paper. And if you have a small business or investments--even more paper.

Whether you hire someone to prepare your taxes or attempt to decipher the forms yourself, it is imperative that your papers be in order for this 'fifth season.' Organizing your tax-related documents is not just a project for the evening of April 13th. Good tax organization is a year-round process.

Some pitfalls of being disorganized at tax time:

• You run the risk of misplacing important receipts/documents

• You feel stressed from the mad dash to the tax preparer/post office on April 14th

• Your tax preparer may charge you more money if they have to spend time wading through your piles of loose receipts.

How to remedy these tax-time situations? Prepare now for next year by getting organized!

Set up an all-year round file system

Designate a box, accordion file, or a file cabinet for year-round paper storage and retrieval. Create folders for receipts, credit card and bank statements, anything you have spent money on or need to keep track of for tax purposes. As you acquire such documents, place them in the appropriately labeled folder. This is beneficial not only for tax time but for when you have to retrieve certain papers throughout the year.

Give your tax-related papers a home

Every January, our mailboxes become flooded with documents necessary for filing your taxes. At the beginning of the year, designate a large envelope or box in one area of your home or a file in your file cabinet for these papers. Examples of these are:

• W2's

• 1099's

• Mortgage interest statements

• Bank interest statements

• Real estate tax statements

• Investment statements

• Receipts for charitable donations

Sort and create categories for your papers/receipts

By early February you should have received all paperwork necessary to complete your taxes. Take that envelope/box/file of collected papers and sort them by category. This process will enable you or your tax preparer to quickly locate your papers and receipts. Some basic categories are:

• Salary

• Real Estate

• Medical

• Childcare

• Investments

Save your tax preparer aggravation by throwing away the envelopes that your statements came in and tear off the perforated edges from your income statements. Group the documents into the categories you've created and paper clip them together. Place all of these papers in a folder or large envelope.

Call your tax preparer early

If you're using a tax preparer, call in January to schedule a mid to late February tax appointment. Doing this forces you to organize and compile all the necessary information by that date. Also, accountants get very busy as April 15th approaches. You don't want an exhausted accountant doing your taxes...

Being organized at tax time will give you greater control over the tax preparation process. Instead of feeling overwhelmed, you will feel a sense of calm and accomplishment. Instead of frantically searching for documents you will be able to produce them at a moment's notice. Instead of your accountant cursing your name, he/she will sing your praises when you present them with an envelope of organized papers and receipts.

The sooner you get organized for tax time the sooner you may get that big refund check. If that's not motivation enough, I don't know what is...

About The Author

Stacey Agin Murray, professional organizer and owner of Organized Artistry, LLC, transforms mess into masterpiece with patience, organizing know-how, and a sense of humor. For a free e-list of Top Ten Tips for Organized Living, or to order your copy of 7 Steps to an Organized Wedding Thank You Note please visit her web site at http://www.organizedartistry.com.

stacey@organizedartistry.com

---

Render Unto Caesar

Once a year Canadian taxpayers are required, by law, to... Read More

Home Based Business Tax Deductions

Running a home based business reaps many wonderful tax deductions... Read More

How to Reduce the Estate Tax Using the A-B Revocable Living Trust

In a past article I relayed the plight of the... Read More

Are You An Innocent Victim of These Popular Myths?

Misconceptions, misinterpretations and just plain "untruths" are floating about income... Read More

The Internet Tax Man Cometh

Q: I was contacted by the city tax collector to... Read More

Some Folks Pay A Lot Less Tax Than Others On Very Same Income?Did You Pay Too Much Tax In 2004?

Someone once remarked, "Next to being shot at and missed,... Read More

10 Tax Tips to Reduce Costs and Increase Income

No one likes paying tax. Everyone understands that tax is... Read More

Correspondence From The IRS ? Yikes!

It's a moment every person dreads. You pick up the... Read More

What the Tax Software Companies Dont Want You to Know

Haven't done your taxes yet? No problem. Now there is... Read More

10 Thoughts on Tax Offer in Compromise

Beware of advertisements that claim to settle tax debts for... Read More

The Tax Man Cometh... To Search

You're at your office, or home, and the doorbell rings... Read More

1031 Exchange Rules and Requirements

Following is a reproduction of the IRS's rules and requirements... Read More

What to Do If You Can?t Pay Your Taxes

The end of tax filing extensions is quickly approaching. What... Read More

IRS Statute of Limitations: Do Taxes Ever Expire?

Many Americans believe that an IRS debt is a debt... Read More

Know A Tax Cheat? Get Paid To Tell The IRS

According to the IRS, taxpayers underpay their taxes by some... Read More

Electronic Commerce Taxation and Pakistan

Assume a buyer in Pakistan downloads software from the Internet... Read More

Save Money on Taxes - Is the Only Way to Get Your Tax Savings is to Sleep With an IRS Agent?

Tilting the Tax Laws in Your Favor.In order to accelerate... Read More

Fiscal Deity: Tax Consultant

Strategic planning throughout the year results in a minimal tax... Read More

Marriage or Divorce ? Check Your Social Security Number

Newlyweds and the recently divorced should make sure that names... Read More

Tax Trap #5 -- Ignoring The IRS (and the 5 best ways to contact them!)

We all love to criticize the IRS, don't we? And... Read More

Furnishing Evidence in E-Tax Compliance

Self-assessment relies on taxpayers voluntarily meeting their tax obligations. This... Read More

Requirements To Produce Tax Information (Whats Up With That?)

"What we've got here is a failure to communicate." ... Read More

Reducing Taxes Through Dividend-Salary Mix Calculations

Should I take wages or dividends from my privately owned... Read More

Employment Taxes ? What Are They?

If you have employees, you are responsible for paying a... Read More

Corporations Failing To Claim AMT Exemption Overpay Taxes By $11,000

Does your incorporated business pay alternative minimum tax ["AMT]? If... Read More

What You Need To Know About Taxes If You?re Getting Married

It may not be high on the list of wedding... Read More

Euro Tax Haven Threat

Media reporting of a new EU savings tax directive has... Read More

History Of The Federal Income Tax

The powers of Congress, and the limitations set upon those... Read More

Estate Taxes - It Pays to Plan Ahead

Estate taxes. It's not enough to simply know they exist,... Read More

Tax Strategy - Let Washington Pay for Your Corvette, Porsche, or Air Plane

Deducting Your Auto ExpensesAuto deductions are a very complex topic.... Read More

Access to E-records by Taxing Authorities: A Case for Pakistan (Part II)

All tax authorities to e-commerce transactions should investigate the record... Read More

How To Claim CHILD TAX CREDIT The Right Way And Add An Extra $2,000 To Your Refund

The U.S. Department of Agriculture estimates that it costs nearly... Read More

Income Tax Returns Your Accountant Should Not File

You've been feeling uneasy (perhaps even guilty) because you've failed... Read More