How I Organize Our Tax Documents in Minutes!
posted by Andrea | 01/23/2012
Every year around this time, I start getting lots and lots of emails from people who are overwhelmed and don’t know how to get all their tax documents organized for the upcoming tax season.
And while I know it can seem like an extremely time-consuming task, I use a really SIMPLE system that allows me to have all my tax documents ready to go within minutes… seriously!
Here’s what I do…
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1. Create.
At the beginning of each new year, I create a manila file for that year’s taxes {I just created my “2012 taxes” folder a couple weeks ago}
2. File.
Over the course of the next 12 months, I immediately file EVERY document I will need for tax purposes into that manila folder.
3. Evaluate.
When it’s time to have our taxes done, I quickly look through our folder to make sure I have all the documents I need, and then bring it to our accountant.
I’ve been using this ultra-simple method to organize our personal and business tax documents for the last several years; and so far, I haven’t spent more than a few minutes getting all our tax documents organized for our accountant.
And I’ve never needed to go back and find something that I forgot or misplaced.
It might be too late to implement this system for your 2011 taxes, but it’s the perfect time to create a folder for your 2012 taxes. I guarantee you’ll thank yourself next year when it only takes 5 minutes to get things organized!
How do you organize your tax documents?
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Filed under: Clutter Control • Paper
Firesparx
23/01/2012I have almost the same technique except my file folder is labelled “Current Year Tax Docs”. That way I don’t have to make a new folder every year. When we get our taxes back I file them into a two-pocket folder (hubby’s taxes on one side, mine on the other).
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Kristia {Family Balance Sheet}
23/01/2012I do something very similar and I have a post ready for tomorrow about the topic. We have our tax meeting this week….tis the season.
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skye @ neathering our fest
23/01/2012we have two envelopes – one for my husband (who is a pastor) and one for my business! it seems to work pretty well for us!
but i agree that immediate filing is the best way to do it. no matter what you keep it in – as soon as you get that receipt or document, stick it in the folder! that way there is no chance to lose it! 
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Heather Ratliff
23/01/2012That’s exactly what I do! When I file our taxes, a printed copy goes in one file folder with the TurboTax CD and I keep the CD for the same number of years I keep other back up documents (7, I think). I keep all my backup documents in a plastic shoebox and store it in the top of a closet. Then I clean out the documents each year and use that now-empty box for this year’s documents.
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jerilyn
23/01/2012I do this but usually start my folder in January for the last year. I seem to only need W-2s, bank and church giving statements. Um, what should I be putting in all year?
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Heart and Haven
23/01/2012I also use a manilla folder for the year, ie. “2012 Taxes”.
Also, for my rental properties – I created an Access database where I keep track of all our expenses (ie. maint., repairs, utilities, etc.). I have a box that I keep next to our file cabinet to place the receipts, then enter them into the database from time to time, and file the receipts as back-up in case of an audit. With the Access database, I can easily print out a report (listed by property and year) of all the expenses with totals at the bottom to make it easy for my accountant.
I also keep an Excel spreadsheet (adding a new worksheet for each year) where I track things like medical costs, childcare costs, donations, car registrations, mortgage interest & property taxes.
- The reports I print out for my accountant saves me money by having the totals in a convenient format for him, rather than paying him by the hour to add up all my receipts that can be used for tax deductions.
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Anna
23/01/2012I do the same thing, except I use a large envelope. It’s a huge help to just take a minute during the year and immediately file what I need and have it all right there when I get ready to do my taxes.
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Lyn
24/01/2012In addition to bank statements, giving receipts and W-2s, you need real estate tax bills, medical and Rx receipts, 1099s from investments, receipts from donations of goods at Goodwill and receipts from donations of new items (back-to-school supplies in August, angel tree items in November and December, etc.).
I also use an envelope to keep track of it all.
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jackie
24/01/2012I have been paperless since 2009, Quicken allows you to attach copies of any payment, so I attach them as I enter the entry in the register, shred and recycle the paper….no paper to to store or file!
At the end of the year I put any end of year statements in the file for the accountant and if they need a copy of anything I just print it off and send it over. Love not having the big file to hold on for 7-10 years! Whooo Hooo!
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Tara
24/01/2012This is such a surprisingly easy system! The unfortunate thing (for me, anyway) is that no system works unless I actually work it, and I always fall short. I guess if I put the file somewhere easily accessible it might be easier to do, but I still forget to put stuff into the folder. Gah!
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Organize your morning with a soundtrack | Smart Living Blog
25/01/2012[...] Of course, there’s at least one major hurdle standing between you and that perfect vacation: April 15. Tax Day is coming up fast, and Andrea Dekker offers “a really simple system that allows me to have all my tax documents ready to go within minutes … seriously!” If you follow her filing advice throughout the year, Dekker says it won’t take more than 5 minutes to get everything organized when you’re ready to do your taxes. (Simple Organized Living) [...]
Patty Gardner
01/02/2012My system is similar except that I write details on the front of the file. I have spaces for personal property taxes, health insurance (we’re self-employed), real estate tax, etc. As those papers come in, I write the amount on the front of the file and place the supporting document in the file. Then when I do our taxes (using Turbo Tax), everything is on the front of the file. And I can see at a glance what information is missing.
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michelle
24/02/2012What about all your business receipts, mileage etc? Home office deduction stuff, utility bills etc? Are they all in their or do you have another business file?
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Andrea Reply:
February 24th, 2012 at 9:05 am
I have a separate folder for my business taxes — but I also do a lot of that online at http://www.outright.com
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