Spring tips – Part 1

Tax Season – Paper Management Tips

Some people maintain ongoing record-keeping systems – this is the preferable method. Others stash receipts and wait until the last minute.
Whatever your personality, everyone should have A SYSTEM to avoid penalties and save paying Uncle Sam too much!
The benefits of an ongoing system include: being ready to file taxes on time without as much stress; making better financial decisions throughout the year; and making it easier to prove your deductions if audited because you’ll have the documentation on hand.

The following are some tips for managing an ongoing record-keeping system:

  • Make, and keep, appointments with yourself to maintain records – daily, weekly or monthly as needed.
  • If you forget something, don’t give up on the system. An imperfect system is better than no system at all.
  • File records such as deduction receipts and W-2 forms as soon as you get them. You may use an open box filing system on your desk or in a drawer so you can easily throw them in as you get them.
  • Be sure to create a new folder at the beginning of each year to immediately file records away for the following tax season.

Are you the type who throws all of your information in a box and waits until March before sorting through it? Don’t fret. You can still get it done. Just understand that rather than spending a few minutes a day or week you will have to spend several hours up to several days at one time in the month before April 15th. It’s up to you on how you want to spend your time. The best way to tackle this box is to take all collected records and sort them. Label each pile clearly. Then, take one category at a time to process them.
What about keeping your past records? Be sure to identify space such as a designated box in a secure place to store your records. The general rule for keeping back-up documentation is seven years, as the IRS can audit you back six years, assuming there is not a case of fraud. To organize these past records, create a file by year with categories by deductions such as medical, taxes, etc. Keep your tax returns permanently.

Get Organized with Technology

The advent of technology and its myriad of tools and gadgets have made a tremendous impact in the world and in our lives. They are also essential to being productive and organized in the workplace by helping keep us from being buried in papers.
Research shows that the average worker spends 150 hours per year looking for misplaced information and that an average of $250 is spent in recreating a lost document. There are three areas in particular where technology can make you more efficient and be more productive so that you don’t have to spend countless hours searching for documents.

File Management Solution: Whether you need to keep from getting buried in a mound of papers or you need to manage papers that have already been filed, a great technology tool is The Paper Tiger software, which organizes documents and information using a numeric filing system. The Paper Tiger helps users easily find documents and tame the paper clutter.

Contact Management Solution: Need to keep track of contacts, potential clients or create a user friendly database? Products such as The ACT! by Sage Product Family, which can be purchased, or Microsoft Outlook, which comes free with most computers, are great tools to manage your contacts, appointments and to-do reminders.

Financial Management Solution: Say good-bye to folders and calculating spreadsheet formulas. Consider using financial software such as, Quickbooks/Quickbooks Pro, to help you keep track of invoices and other key areas of your business and personal finances. This type of software is user friendly and its uses can be customized to your specific needs. It makes getting ready for tax season a lot easier too.

While technology tools are useful and can be fun, use them wisely. Be sure they actually save time and help you stay in balance. If you spend time fixing errors, learning unneeded skills or playing games, it is not a good time investment.


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