3 Easy Steps to Organize Your Taxes

3 Easy Steps to Organize Your Taxes

It’s that time of year again — time to get organized to file your taxes. If you’re just getting started, here are 3 easy steps to organize your taxes for this year.

Purchase Supplies

You will need a file box or accordian folder, and file folders. I use the file box during the year for all of my tax information and then transfer the folders that apply to the year that I am filing taxes for to an accordian file once my taxes are done for the year. You can find the file box and accordian folders at local discount or office supply stores or  here on Amazon.

Label Your Folders

Depending on your situation, you will need different folders. I create folders for the following categories:

• pay stubs/W-2’s/1099-MISC for any contract work
• bank statements (including any savings accounts)
• charitable giving records
• medical expenses and mileage records
• business expenses (with receipts and invoices)

You could also make a folder for mortgage paperwork, investments and retirement accounts as well as any other items that you can deduct on your taxes. You can also place all paperwork for deductible items in one folder labeled deductions.

Gather Paperwork

You will need a list of you and your spouse’s social security numbers along with the numbers for any dependents you are claiming. I place this in the folder with our W-2’s. You will need interest statements from any interest bearing accounts including savings accounts and investments; documentation of real estate taxes paid as well as state and local income taxes paid.

Hopefully you at least have one location where you’ve stored your paperwork for the year. If not, you’ll need to take some time and gather everything together in one place and then sort the papers into the appropriate folders.

Once you’ve completed this step, you are ready to go to your tax preparer or file your taxes online.

Please Note: This post is not intended as professional tax or accounting advice. You should seek the services of a professional accountant or other financial professional to help you with your specific situation.