Tax Tip Thursday – Week 3

January 29, 2009

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As an organizer, I am regularly recommending that folks donate unwanted goods to charity.  Not only will it help clear the clutter and  help those in need but they can also get a tax receipt.  This week’s Tax Tip Thursday is dedicated to information on just that!  You give…You get.

When donating goods to charity, make sure the items are something that someone else would want.  They need to be in good working order.  Charities spend tens if not hundreds of thousands of dollars each year on trash disposal — items people donated that are really trash.  So if you really want to help a charity, be selective on what you donate.

The good rule of thumb for donating goods is to keep detailed record in case of an audit.  I suggest (and do for my clients) the following:

  • Document what is donated
  • Take photo of the items donated
  • Donate to an organization that is an official tax exempt charity
  • Retain a tax receipt from the charity

How do you “value” what has been donated?  There are many sources that give you fair market value.  This is a start, but then it is best to consult with your tax professional.

  • IRS info on donating goods (IRS)
  • Workbook – “Money for Your Used Clothing” (Workbook)
  • Bankrate.com valuation worksheet (Worksheet)

If you didn’t keep good records in the past, now is a great time to start.  It is easy, and worth it to all.  You benefit and so do many needy charities.

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And now a word from my lawyer….you should consult your tax professional or irs.gov for any rules and/or tax laws. Atmosphere does not represent itself as a tax professional.

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So are you like many who have an unexpected day home due to snow or ice?  School or activities cancelled?

I grew up in New England when school was cancelled once the snow actually fell and it was getting too tough to drive in.  Couldn’t image school being cancelled before the flake fell.  Even President Obama was just joking at a news conference that his daughters couldn’t believe they didn’t have school today because of ice  in Washington.  The girls said back in Chicago, they would not only have had school but they would have gone out for recess!

So you have some time at home you had not planned on?  Take an hour and de-clutter an area that has been bugging you.  Many areas don’t take long at all to go through.  Take everything out, sort by like item.   Re-locate anything that does not belong.  Toss anything that is broken, expired, no long used.  Make a donate pile for anything that can be donated.  Easy areas to tackle in a short amount of time include:

  • Kitchen junk drawer
  • Medicine cabinet
  • Vanity
  • Under sink
  • Kitchen island
  • Mail center
  • Kid school paper drop off
  • Tupperware area

Take advantage of the extra time!  Then make some hot chocolate,  go out and make a snowman, help an elderly neighbor.   Embrace the unexpected!

I like to have “noise” in the background when I work.  Today listening to my regular cable news there sure is a lot of “NOISE.”  Doom and gloom with the financial markets.  Monday morning announcements of bad earning and more layoffs.  I think it is time to switch to listening to music!

We have to keep ourselves positive and moving forward.  Many folks I have talked to are in a panic even though they have a secure job and their pay continues the same and will not be using their recently diminished retirement funds for another 25 years.  They are reacting to the unfortunate news they continue to hear and read.  Now you must always be prepared ….but to fester on negative news and live in the land of negativity is not healthy.  Think about what is working, what is positive in your life.  Many people are facing tough times.  Count the blessing you have.

Worried about your financial status in times like these?  Being organized can help!  Not only with peace of mind, but with finances as well.

Last week while working with clients, my found money total was $3,133.  Money that had  been misplaced.  Yes, I am talking real money, cash-o-la, the Benjamins! Sometimes I joke that I should put a Jerry Lewis Telethon type total board on my website.  Total being how much money (cash, checks, gift certificates, bonds, gift certificates) have been found during organizing sessions!

Now we don’t always find money,  but it is fabulous when it happens!  Here are some other tips to lessen the stress and save money in tough economic times.

  • Limit purchases.
    • Curb abundance – need vs. want.
    • Less focus on “things.”  Focus on life, family, friends.
    • If something is on sale for 70% off and you don’t need it, you just wasted 30%.
  • Save money by not wasting it.
    • Organizing closets and other areas help you see what you really need.  Many times people waste money by buying items they ALREADY have because they cannot locate them.
    • Don’t let late fees and interest payment add up.  Pay bills on time.
    • Review your spending….cell phone plans, insurance premiums, etc.
  • Make money by clearing out the clutter.
    • Donate unwanted items to charity and obtain a tax receipt.  This not only helps you (more peaceful living space and a tax credit) but it also help others who are facing even bigger financial challenges in this environment.
    • Sell, sell, sell.  Use Ebay, consignment, Craig’s List, etc. to sell items that are no longer important to you.
  • Create a mail system.
    • Cancel catalogues that are tempting to make purchases from.
    • This is one area of clutter than can be done in minutes a day.
    • Utilize “get off list” services to limit the amount of mail that comes in.
  • Organize finances and important paperwork.
    • Know your financial situation & take control.  Don’t stress just because the that is what we hear on TV.

Tax Tip Thursday – Week 2

January 22, 2009

Welcome to week 2 of Tax Tip Thursday!CB022164

So by now you have done the 1st Tax Tip exercise– you have organized your 2008 receipts and documentation.  Well at least it is on your to do list!

Now it is time to start reviewing your documents and determine what you will need for tax prep.

  • If you use software such as Quicken or  a home made spread sheet, run your category totals for the year and look for and correct any errors.
  • Save all the totaling up for end of year? Get started!
  • Have a pen and paper handy for info that pops in your head, questions you need to ask, a list of things you need to research further.
  • Make sure you have proper documentation for any charitable donations, include clothing and household item you have donated.
  • Determine what receipts and documentation you need for tax prep. Not all will be needed or tax deductible. Keep non-tax related info separate from the tax related.

In future posts I will outline what to keep and what not to keep as well as discuss procedures and tips for donating goods to such charities as Big Brother Big Sister, Salvation Army, etc.

January 31st is right around the corner. This is when all W2’s are required to be sent out. Be on the look out.

It is now time to make your appointment with your tax professional or  purchase your self prep software.

Ready, Set, Go!

Organizing the White House

January 21, 2009

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Scheduled to work from home yesterday, I hate to say I watched a lot more of the inaugural than I had planned.

The event planner and organizer in me was so curious about what was going on behind the scenes. The organization of all the events, but most of all the actual White House transition; the move out, the move in and all of the organizing.

You could see the moving trucks with the new First Family’s items in them. This would be an organizer’s dream!

Well, it took more than one. The full White House home quarters staff was on hand. 93 people in all. The Chief Usher is the one in charge of the process. By the time 12:01 stuck on the clock, all of the presidential photos were switched out. All of the unpacking had to be done by the President came “home” from the parade. That means everything — from clothing in their closets, to their favorite foods in the kitchen. Not a box to be seen. 7 trucks, in 6 hours…now that is organized!

Boy would I have liked to have been a fly on the wall or actually there doing it!

I only recommend products that I really like. For closet systems I suggest either Elfa systems from The Container Store or full service closet design and installation from Brian McSharry of Closet & Storage Concepts.

Check out The Container Store’s annual January 30% off sale. http://www.containerstore.com

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Elfa is a great system. Strong and versatile enough that they’re store fixtures are from their own product lines. It is SUPER easy to install. They also have a new install service if you don’t want to fire up the power drill.

If you have wondered what the difference is between this and the similar product from Home Depot type stores? I did too, so I did a little comparison. The basic materials are the same price at all stores. The price difference come from the shelving. The Container Store shelves are almost double in price but they are much better quality. If you are doing a predominately hanging system, then this doesn’t even come into play.

But, the key advantage (and worth the extra shelf pricing in my mind) is that The Container Store is always fully stocked. You go in, you bring in your measurements, work with a designer. They give you one of those restaurant buzzers and it goes off when your order is ready. All cut EXACTLY to your measurements. All organized. In a cart and they even put it in your car!

At the other stores, they have limited sizing and you have to do all the cutting yourself and many times they don’t have full inventory. Many times I’ve tried, but I end up walking out empty handed.

But before you head out to buy a new closet system, you must go through your current closet, purge out what you do not want, and really measure and design the new space. How can you maximize space? How much short hanging do you need? How much long hanging? How many pairs of shoes do you need to store.

Need more time? It is good to plan. Atmosphere has a relationship with the Container Store allowing us to offer a 20% discount year round for projects we do.

Even if it is not time to re-design your closet, take a peak and see what can go…

Tax Tip Thursday

January 15, 2009

For the next month or so I am going to post weekly tips to make tax time, less taxing. Why Thursday? I was going to do it as a weekend project post, but I want to give you enough time to schedule time on the weekends to work on it. Plus, it sounds cuter than Tax Tip Weekend.

This first exercise you should do right away if you have not already done so. As for future posts, you can do them together or week by week. Whatever works best for you, your schedule and your threshold for working on such a project.

Don’t rush. You have three months from today. Rushing can cause mistakes and you don’t want Mr. IRS Auditor showing up on your door step. However, don’t put it off too long, or save it all for one mad session. And of course, reach out to a professional organizer if you need help!

WEEK 1: Out with the Old, In with the New

The Old

  • Remove all 2008 receipts and documentation from your files.
  • If you already have files set up this should be easy to keep like documents clipped together.
  • If you are more of the “shoe box” filer, gather them up. Go on a search and find mission. Check out the car, the desk, drawers and coat pockets. Gather them all up and put them in one place.
  • If you have time, sort like items together — utilities, medical, mortgage info, etc. If not, make that a project for next week.
  • Put all 2008 info in one area for tax prep. This can be a file, a bin, a box or a basket. As you receive more documentation such as year end statements and W-2’s, put them in there as well.
  • Pull out your 2007 tax return in case you need for reference.

The New

  • Set up files for 2009 receipts and documentation
  • File any 2009 receipts and docs
  • Make a habit of filing on a regular basis. It will make this time of year easier.
  • Do not file mailing envelopes and the all that extra marketing material with paid bills.

Before & After

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And now a word from my lawyer….you should consult your tax professional or irs.gov for any rules and/or tax laws. Atmosphere does not represent itself as a tax professional.