Deprecated: mysql_connect(): The mysql extension is deprecated and will be removed in the future: use mysqli or PDO instead in /home/a26f9f83/public_html/articles/includes/config.php on line 159
Organizing Your Taxes > NetSparsh - Viral Content you Love & Share

Organizing Your Taxes

Does this scene sound familiar? It's April 7. You haven't seen the top of your dining room table in two weeks because of the piles of paid bills, receipts, canceled checks, and unidentified cash register receipts covering it. Your head pounds and your stomach churns as the countdown to April 15 begins.

You might hate to pay taxes, think the system is unfair, dislike the forms, and even stage a mini-tax rebellion, but in the end the tax man cometh ? with penalty if you're not careful! The key to your survival is taking an organized approach to this unavoidable task.

There are really two issues here. Number one, of course, is getting the information together for this year's tax return. Number two is developing a strategy, which will eliminate the panic you're feeling now next year ? and now is the easiest time to do that too. Consider these tips:

? If you use a tax advisor, make an appointment to get together well before April 15. For the future, do it before the end of the tax year, and you may be able to save on your tax bill.

? Designate a specific, easily accessible place to keep all the information relevant to your tax return.

? Pay tax-deductible items by check or credit card whenever possible. If you have many tax-deductible items, get a separate credit card for those expenses.

Now, for this year:

Step 1: Collect all the records you can find: canceled checks, credit card receipts and statements, canceled checks, cash register receipts, calendars, and any articles or other information you may have collected with information about what you can deduct. (Use Post-it? Flags to highlight important information.) If you're not sure, discuss with your accounting the critical information to include with your tax return, including documents to support any wages or other income received as well as mortgage interest paid.

Step 2: Separate all the papers into appropriate categories. Put each one into a separate container ? large envelope, plastic basket or shoebox. Labeling each category with a Post-it? Note will make it easier to adjust your category names if you change your mind as you proceed. Since you will probably need more than one sitting to complete your taxes, these labeled containers make it easier to clear your work area, if necessary, and to find your place when you are ready to continue.

Step 3: Take one category at a time and eliminate (or staple together) any duplicate receipts. If you need to correlate your expenses with your calendar in order to prove tax-deductible expenses, such as in the case of entertainment, put all receipts in chronological order to speed up the process. (Use a different color Post-it? Flag for each deductible category.)

Step 4: Now you are ready to begin entering the information on the tax forms, into your computer program, or to take the information to your accountant. (Many accountants will provide a worksheet of compiling information.)

Once you've finished filing your return, the next consideration is how long to keep the material you've collected. The simple answer is to keep whatever you need to persuade the IRS that everything on your return is accurate, and hang on to the evidence for as long as the IRS has the right to question your return. But I'm sure you wanted a more practical answer!

Ordinarily that's three years from the due date for the return, including extensions, to assess any additional tax. But a return can be audited for six years if the IRS suspects the taxpayer has neglected to report substantial income. If fraud is suspected, there is no time limit.

Your record keeping system doesn't have to be elaborate or sophisticated. What is more important is to have a system ? and the discipline to keep it up to date.

Make sure to keep tax information separated by year. If you have a minimum amount of back-up material, one file folder may be sufficient. Staple together all information for each itemized deduction. Label it clearly with a Post-it? Note. Otherwise, use separate file folders or envelopes for each category. If you run a business and have a very large amount of material, use one storage box for each year. Make sure to label the outside of the box! Put all boxes together. As you put in this year's box, you can remove the box with information you no longer need to keep. Sorting your back-up materials will be easy to do right after you filed this year's return when the categories are fresh in your mind. If you are audited, it will be easy to provide documents to support your tax return.

In addition, consider these tax tips:

? If you write off the cost of a business car, keep the logbook in which you recorded your trips as well as evidence of the costs you incur.

? If you claim as a dependent someone who is not your child, keep a separate file for the evidence that shows you provide more than half of that person's support.

? Keep information that relates to the purchase of all homes at least six years after the sale of the last house. This includes your title, deed of purchase, and information about your home's purchase price, sales price, capital improvements and repairs.

© Barbara Hemphill is the author of Kiplinger's Taming the Paper Tiger at Work and Taming the Paper Tiger at Home and co-author of Love It or Lose It: Living Clutter-Free Forever. The mission of Hemphill Productivity Institute is to help individuals and organizations create and sustain a productive environment so they can accomplish their work and enjoy their lives. We do this by organizing space, information, and time. We can be reached at 800-427-0237 or at www.ProductiveEnvironment.com

In The News:

This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news

CNBC

Do this now to avoid a tax surprise next spring
CNBC
Review your withholding now to make any necessary corrections and avoid a surprise tax bill in April. Unfamiliarity with credits, user error and failure to weigh state and local taxes may yield inaccurate results on the IRS's calculator. Consider your ...

and more »

Forbes

How IRS Taxes Kill Plaintiff's $289M Monsanto Weedkiller Verdict
Forbes
But even if Monsanto forks over the money, new tax rules will be as effective as Roundup in swallowing up most of Mr. Johnson's big verdict. Under President Trump's tax bill passed in late 2017, there is a new tax on litigation settlements: no ...

and more »

Lewiston Morning Tribune

Lewiston delays decision on forgone taxes
Lewiston Morning Tribune
The forgone taxes would be dedicated to fund the city's share of on- and off-site infrastructure improvements around the Warner Avenue property that contains Community Park and the future sites of the new Lewiston High School and the Lewis-Clark State ...


Fortune

Apple Has Appealed Its Taxes Nearly 500 Times Since 2004
Fortune
Apple has been awfully active over the last decade trying to get its tax bill down. In a deep dive into Apple's tax-appeal cases since 2004, the San Francisco Chronicle found that the company has appealed tax assessments in Santa Clara County 489 times ...
Apple fighting high property tax assessments in Santa Clara countyAppleInsider

all 3 news articles »

Forbes

Want To Cut The Taxes In Your Retirement Money?
Forbes
Many people investing in retirement plans such as 401(k), 403(b) and IRAs don't fully understand tax-deferred investing. Let's look at a few of the tax issues related to retirement planning and investing. Short-term tax vs. long-term tax aka capital gains.

and more »

Longview News-Journal

Gregg County officials continue exchanges over taxes, revenue
Longview News-Journal
The Gregg County Commissioners Court proposed maintaining the tax rate Monday, and scheduled public hearings for the mornings of Aug. 27 and Sept. 4. The proposal passed by a 3-1 vote, but not before last week's banter between County Judge Bill ...


WOAI

IRS seeking nearly $500B in back taxes
WOAI
The IRS says so far, it's in the process of sending more than 360,000 names of individuals who owe $51,000 or more in delinquent taxes. The program, part of the Fixing America's Surface Transportation Act from 2015, requires the State Department to ...
IRS Withholding Calculator | Internal Revenue Service - IRS.govIRS.gov
Fixing America's Surface Transportation Act or the FAST Act - FHWA | Federal Highway AdministrationFederal Highway Administration - US Department of Transportation

all 33 news articles »

MyStatesman.com

Georgetown keeps tax rate flat, but property taxes to rise
MyStatesman.com
Despite keeping the same property tax rate, the typical homeowner would see a $57 increase in taxes because property values have risen by an average of 4.9 percent. There also would be a $4.80 per month increase in the base electricity rate for ...
Better Understand Your Property TaxesTAPinto.net

all 6 news articles »

Consumers turning more pessimistic about wages, stocks, home prices, taxes
MarketWatch
The median expectation that taxes will go up in the next year — just months into a tax cut — rose for the fifth straight month, to 2.2% after the series low of 1.5% in February. Relatedly, year-ahead expected growth in government debt increased from ...


Reuters

UPDATE 1-Argentina suspends cuts in soymeal, soyoil export taxes
Reuters
(Adds details of treasury ministry statement). BUENOS AIRES, Aug 14 (Reuters) - Argentina has suspended its program of gradually cutting soymeal and soyoil export taxes for six months, the treasury ministry said in a statement on Tuesday, part of the ...

Google News

IRS Certifies 2006 Toyota Hybrid for Clean Fuel Deduction

The Internal Revenue Service has certified the 2006 Toyota Highlander... Read More

Electronic Commerce Taxation and Pakistan

Assume a buyer in Pakistan downloads software from the Internet... Read More

Home Based Business Tax Deductions

Running a home based business reaps many wonderful tax deductions... Read More

Tax Trap #5 -- Ignoring The IRS (and the 5 best ways to contact them!)

We all love to criticize the IRS, don't we? And... Read More

Furnishing Evidence in E-Tax Compliance

Self-assessment relies on taxpayers voluntarily meeting their tax obligations. This... Read More

Tax Trap #2 -- Double Taxation: Isnt Once Enough?

Have you been thinking about incorporating your small business or... Read More

Small Business Tax Deductions for Year End 2004

As a small business owner, it's wise to familiarize yourself... Read More

History Of The Federal Income Tax

The powers of Congress, and the limitations set upon those... Read More

Taxing Overseas Firms for SOX Compliance

The Sarbanes-Oxley Act, also called the Public Company Accounting Reform... Read More

Rearrange Your Affairs For Maximum Tax Savings

One way to maximize your business profits is by reducing... Read More

Tax Investigation - What You Need To Do

The knock on the door from a Tax Inspector is... Read More

How To Get An Instant Pay Raise

As a gentleman was leaving my class recently, he wanted... Read More

I Havent Filed a Tax Return with IRS in Years, What Do I Do?

In elementary school, kids come up with creative excuses why... Read More

Home Business Tax Tips

If you have recently started an Internet or home business,... Read More

The Internet Tax Man Cometh

Q: I was contacted by the city tax collector to... Read More

Complaince of Tax Return in Electronic Commerce Taxation

Emerging Legal issues of Tax compliance of e-business Self-assessment system... Read More

Small Business Tax Credit - Americans with Disabilities Act

Many small businesses complain when confronted with the expense of... Read More

Car Donation: An Easy Way to Support Your Favorite Charity and Get a Tax Deduction

Most people look forward to getting their tax return, but... Read More

Back To School ? Educators Deduct School Expenses

As teachers and students head back to school following a... Read More

Donating Cars To Charity - New Tax Rules

On June 3, 2005, the IRS released guidance on charitable... Read More

Access to E-records by Taxing Authorities: A Case for Pakistan (Part I)

Background issues of access to recordsTo assess the records at... Read More

Amending Procedural Laws for Collection of E-taxation

The electronic transaction ordinance defines the certificated copies in which... Read More

Tax Strategy - Let Washington Pay for Your Corvette, Porsche, or Air Plane

Deducting Your Auto ExpensesAuto deductions are a very complex topic.... Read More

Tax Records - What You Should Keep And For How Long

Many taxpayers are confused about how long they should keep... Read More

Getting A Second Extension to File 2004 Taxes

Millions of people file tax return extensions every year. The... Read More