Tax time is upon us once again causing those that aren’t prepared to panic. Organization of paperwork can help the average tax payer to experience a virtually stress free tax time. Organizing paper work for tax time means developing a system that will help you find every thing not only during the current tax year but in coming tax years as well.
There are papers all over the house that you need to file your taxes and you can’t find them. Deciding which form you are filing with will help to determine what paperwork is required. This decision will help you to gather tax papers quickly when it comes time to prepare the return. If you file a short form all you have to do is wait for your forms to be mailed to you, but if you aren’t there are some things you can do to get the paperwork organized so you’ll be prepared for the next tax year.
The quickest way to organize paperwork for this tax year is to separate everything into piles but that won’t work every year.
Paperwork is easier to keep track of if business and personal accounts are separate. This allows tax papers to be gathered quickly. Business expenses, profits and losses are easier to find when they are the only items on an account statement. Filing personal account statements and business account statements separately is a must for finding the information needed quickly during tax time.
Purchasing business and personal items separately will help with tax time organization. Separate receipts make it easier to find deductible items. Bill receipts should be kept as well if they business is being run out of the home; a portion of the expenses for running the home could be eligible for a deduction.
Manila folders or even large plastic envelopes can be utilized in the organization of paperwork for tax time. Labeling whichever you chose will make it easier to find what you need when it comes time to file the taxes. The choice of filing system is up to the individual, each file should be clearly labeled.
All of the paperwork gathered during the year is organized. Any 1099’s or W-2’s received should be placed with the rest of the paperwork. Whether filing is done electronically or with a traditional paper return the completed form should be copied and placed with all paperwork used in the preparation of the return along with any notices received that pertain to the completed return. Simply make sure to make the folder with the year the return is for when labeling it.