5 Tips on How to Keep Your Sanity During Tax Season

// March 24th, 2013 // Tips for Living, Uncategorized

Tax season is once again upon us. Ever wonder how some of those incredibly organized people seem to breeze through income taxes and others struggle and agonize? We’ve got a couple quick and easy reads below that can help make tax time less painful.

1. Keep good records all year long. To claim a deduction – you must have a receipt. Some people (like me) have a hard time filing all those little receipts on a daily or even weekly basis. So, being a “drop it” person, I have 2 file drawers, one for business and one for personal, where I simply “drop” all my receipts. Then once every 2-3 months I pull them out and organize them into piles depending on the type of receipt and put each of those piles in a different manila envelope.

For example: Utilities in one envelope with the gas paper clipped together, the water has another paper clip on the electric another paper clip. Credit card receipts in another. Mortgage payments have their own envelope, car payments are in their own, etc.

Then – take all of these neat envelopes and put them back in their respective file cabinets and start over. This sorting/organizing is a great thing to do during a rainy afternoon, during a slow football game or boring movie! If you are comfortable with your computer, enter your receipts in your accounting software. Software like Quicken or Quickbooks can make life much easier when tax time comes. If not, just having them at your fingertips in neat organized piles will help.

2. Keep Social Security numbers safely locked up somewhere! Scammers are everywhere now and identity theft is almost a pandemic. Now is a good time to buy a paper shredder if you do not already have one. Shred all old and unneeded papers that have personal information on them.

3. Bring all of your tax preparation documents with you when you meet with your preparer. – Or have them handy if you are doing your taxes yourself. Being prepared is enormously helpful when crunch time gets here.

4. Back up all the data you have saved on your computer.

5. If you use a tax preparer – Ask them for tips and ideas they may have for you as to what other deductions you might be able to take next year and what documentation you should be saving for these deductions.

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