Preparing to do your taxes can be overwhelming, especially if you haven’t been all that organized about keeping track of your tax-related documents throughout the year. Not only do you need to keep track of tax forms you get in the mail (or on-line), but also receipts for tax-related expenses and donations. It can also be very helpful to put your hands on your previous tax returns and documentation for reference. Of course if you get audited, the value of having your tax paperwork organized skyrockets!

Providing your information to your accountant in an organized manner can save you money in tax preparation costs. It will also prevent you from submitting your taxes late in the tax season which is when your accountant will likely be in crunch mode. Be kind to your accountant and they will be kind to you.

Creating a system for organizing all of your paperwork that you can easily maintain can really help to ease the pain during tax season. You are less likely to miss deductions when you have receipts for all your expenses in one place. It will also help you to be better organized throughout the year as you collect receipts and documents for tax purposes.

Also, separating your personal and business expenses makes it easier when preparing taxes. Talk to your accountant about any receipts or items that may apply to both so they can guide you on what to do.

If you need a kick start to get organized and be prepared for tax season, follow these six simple steps.

  1. Collect and Corral:Designate a drawer or a bin and as the tax-related paperwork comes in, toss it in there. Also, create a folder on your computer to save electronic documents. Once you have collected it all (usually by March 1st), sort it into categories (1099s, W2s, Receipts, etc.) and paperclip each category together. You may want to print the electronic documents, or just have them organized and ready to enter into your tax return. Be careful not to miss important documents when you sort through your mail in January and February.
  2. Contain It:Have a folder or bin labeled for each tax year which includes your returns as well as any supporting documentation. After the six years have passed, you can weed out the extra paperwork and just keep your return. You are less likely to miss deductions when you have receipts for all your expenses in labeled folders.
  3. Go Paperless: Yes, the IRS does accept electronic documentation. Scanning papers or electing to receive electronic statements will help significantly reduce your paper clutter and make it easier for you organize and find the documents you need.
  4. Keep Track Electronically:I strongly recommend that you maintain an electronic accounting system, such as Quicken/QuickBooks or even an Excel spreadsheet. There are other programs you can use as well, such as Mint. If you maintain these programs throughout the year, come tax time, all the information you need will be at your fingertips.
  5. Plan Ahead:Create a folder for next year’s taxes. As documents come in throughout the year, you’ll have a place to put them. More importantly, you’ll be able to find them when tax time comes around again.
  6. Start Fresh: Once you have collected all of your tax documents, do a purge of all your files (paper and electronic), so your space is clear for the coming year.

Check these off, get this year’s taxes done, know you’ll be better prepared for next year and breathe a sigh of relief!

By Sarah Buckwalter

Certified Professional Organizer®

Sarah Buckwalter is a Certified Professional Organizer® with over 18 years of experience in home, move and office organization. She is the founder of Organizing Boston. Organizing Boston is the largest professional organizing firm in New England and was awarded Best of Boston Home™, Best Professional Organizer.

Nationally recognized as an organizing industry expert, Sarah shares her expertise through speaking, writing and on television. She is a regular guest blogger for nationwide companies and has appeared several times on the hit series, “Hoarding: Buried Alive” on TLC.

Sarah also runs Organizing U. Organizing U is an online training platform focused on business development, to help Professional Organizers and small business owners achieve their dreams of success.