Monday, January 16, 2006

Organized Tax Time!

Believe it or not, it is tax time again! Why wait until April, when Get Organized Month is here now! Even if you do wait until April to file your taxes, I have some simple organizing tips that will help you in the months ahead.

2005 Taxes
Employers and financial institutions (such as banks and mortgage lenders) are required by law to mail you the appropriate 2005 tax forms by January 31, 2006. This includes W2s and 1099s to name a couple of the forms. You may have already received one of these forms in the mail.

Make sure you have a special place to put these forms where they will not get mixed up with other household paperwork, used as drawing paper by your child, or God forbid, eaten by the dog! Hanging file folders work great. You can also use any sort of folder or envelope. If you feel compelled to use a shoebox, go ahead! The important thing is to keep all of your tax paperwork in one easy to find location.

Now is also the time to spend a few moments gathering up other tax related papers, such as receipts or cancelled checks from donations. If you work with a tax professional, such as a CPA, request a worksheet or list of documents that you need for your appointment (many CPAs will send this automatically). If you prepare your taxes yourself, be sure to pick up the appropriate forms at the post office or library before they are gone.

2006 Taxes
In my last post, I wrote about decluttering my basement and coming up with a few donations. If you decide to declutter during Get Organized Month, remember to request receipts for your donations. However, you will not be able to deduct the value of your donations until 2007 when you file your 2006 taxes.

Just as I mentioned above, make sure you have a special place to keep your 2006 tax related paperwork that is separate from your 2005 tax return paperwork. You will need these papers a year from now!

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