Everyone is familiar with Benjamin Franklin’s famous quote, “The only things certain in life are death and taxes.”
That inevitable date with the tax man has arrived. For many, this year was another year of burdensome and time-consuming tax filing and next year looks to be more of the same. And a cursory search of the web, littered with competing and comprehensive step-by-step articles on how to organize your tax forms, reinforces this notion.
The good news? You have 365 days to get ready for next year’s date!
Even better news? Two simple but powerful organizing principles can help you eliminate nearly all of the stress in finding and organizing your tax records for a timely filing for next year.
First and foremost:
“A place for everything, and everything in its place”
One of the guiding principles I teach and live by is to assign a place for everything, and this certainly applies to financial records, receipts and invoice, both paper and electronic.
This relieves stress in your daily life. I am a firm believer that it can be as simple as an expandable file folder, a spreadsheet program like Excel, or a tax-specific program like Turbo Tax.
Believe it or not, tossing your receipts and records into an old fashioned shoebox just might suffice! Really? Yes, because you know exactly where all of your paper tax records are located. Of course, a file drawer with multiple hanging folders would be effective, as well.
Now that you’ve have established a predetermined place for your tax records, you need to establish a time schedule.
Second and foremost:
“There’s no time like the present”
The second guiding principle that I teach and live by is there’s no time like the present. Procrastination is an insidious monster that robs us of many things, including peace, time and order.
Here’s one simple question that will help you frame your tax preparation schedule: Do I want to spend more time at the front-end of the record-keeping process as income and expenses occur, or do I want to spend more time at year-end and process it all at once?
Front end. Start setting up your filing system on January 1, and doing a bi-weekly filing of all your tax data into your system, whether paper or electronic, grouping your records in income and expense categories by month. This will mean that you are accomplishing all the record tracking throughout the year, and when tax-filing season is upon you, your filing will actually be quick and easy.
Year-end. This means that all the time-consuming work of organizing and filing will come as you approach April and your date with the Tax Man. But, since all of your data is in one predetermined, centralized container, such as the proverbial shoebox, you won’t waste any time looking for receipts or wondering if you have everything you need.
Want to read more and see how organizing taxes looks in real life? Read this tax preparation case study where we give kudos to two savvy and organized taxpayers.
When all is said and done
Expanding on Ben Franklin’s quote, Margaret Mitchell, the author of Gone with the Wind, once quipped, “Death and taxes and childbirth. There’s never a convenient time for any of them.”
All the more reason to do a little planning and a little scheduling. Be a savvy tax organizer. As the shoe and clothing giant Nike reminds us, “Just do it!”
~ A note from Sue ~
I can help you to “virtually” organize any space in your office or home simply by using your cell phone, camera, and computer. Give me at call at 719-495-7626 or email me at Sue@withtimetospare.com. I will tell you how for a minimal charge I can help you to organize those frustrating areas.