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I figured I would give you all a few days to breathe and not think about taxes…

You are probably thinking “will she stop talking about taxes already.”  Well, unless you have put away your 2008 documents  in an organized fashion and shredded what you don’t need, then you are not done.  Consider lessons learned from this past year.  Do you need to set up a more efficient system for 2009?  Do you need to track any expenses in a different way?  Set systems in place now to make the process easier next year.

That is what I am going to do this morning before I head out to work.  Here is how it works at my house.

  • All back up documents and receipts I need to retain are put in a clear bin.  Label indicating the year is adhered to the front.  I keep mine in a closet in my office.  High shelf that is hard to use for anything else.
  • I will be shredding any receipts and documents I do not have to keep for tax record keeping purposes.
  • I keep a copy of my tax forms submitted to the IRS and State in a file in my filing cabinet by year.

So what do we keep?  It can be different for different people –based on what you claim on your taxes. You should check with your tax professional but the general rule is keep tax back up for 7 years.  I hear 3 years, I hear 7years.  Here is the scoop.  The IRS has 3 years to audit you for cause or a random audit.  But if the suspect someone has done something fraudulently then they can go back further.

You  want to keep anything that is back up to what you claim on your taxes.  I always think of it this way.  If I got a call from the IRS about an audit, I will need to show them a receipt or documentation for anything I have claimed.  Those are the receipts that should be in the “tax box.”  If you have receipts for expenses that are not claimed on your taxes, before you toss or shred, consider if you need them for any other purpose:

  • Insurance
  • Warranty
  • Legal

Be sure to check with your accountant or investment representative to see what you need to keep regarding your investments.  There are specific requirements relating to buying and selling of stock.

Here are a few links that can help you as well.

IRS – Record Retention

What to Keep

Ok, now I’ll stop talking about taxes!

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Sorry for the delay in posting…I guess I feel the Spring in the air and between clients I have been working on organizing myself.  Yes, organizers have to organize too! Well, at least do the maintenance to keep our systems in place and every now and then tweak a system to make if more effective!

And it is Tax Time, wrapping up mine today.  Next week we’ll have our final Tax Tip Thursday…what to do with all the paperwork once you have filed your taxes.  Ok, if you have not started your taxes yet, get off this blog and start now!

I had some time this morning and I had a little file purging session for myself.  A nice big bag of recycling and lots to shred.  It feels great!

More next week, I promise…  Wishing you all a Happy Easter and/or Passover.

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30 days and counting…

Tic, toc, Tic, toc

Are your taxes done?  If so, CONGRATULATIONS and I hope the result was a rebate!

Maybe you have all your info ready to go, but are just waiting for your appointment with your tax professional.  GOOD!

If neither applies, get going!

Be sure to schedule time to work on it.  And like many things, it always takes longer than we thought.  If it is usually a last minute, nail biting, lots of coffee to stay up and finish by the deadline type of experience, remember you probably said you would do better next year.

Well it is next year.  A little organization and scheduling time will definitely make “next year” aka this year MUCH BETTER!

Check out my Tax Tip Thursday blog entries in the archives for additional info and tips.  You will feel great to get it off your plate.

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Working on my taxes this week, my mind wondered to the folks who’s tax returns read like fiction.  We’ve heard of so many high profile folks who have gotten caught recently.  A friend and I joke, comparing taxes to types of literature.  Some people write fiction some people write non-fiction.    What type of tax author are you?

Here is a list of of celebrity “fiction” tax writers.  Boston.com ran a compilation today of the Celebrity Tax Cheaters.  Take a read…

Famous Tax Fraud – www.boston.com

Have a great day!

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Tax Tip Thursday – Week 4

February 12, 2009

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So…you have or have scheduled time to empty out the 2008 files, set up ones for 2009, sorted receipts and documentation by like category, totaled up receipts or run reports and checked for errors.  You have documented and calculated your charitable donations.  You have made an appointment with your tax professional or bought your Tax software.

Now it is time to complete your return.  Remember, I am an organizer not a CPA.   Here are some links to further help you prepare and beware.

Tax Mistakes

Tax Central From MSN Money

IRS – Frequently Asked Questions

Tax Tip Thursday will resume in a few weeks…where we will focus back on the “organization” of tax related documents, what to keep, what to shred, etc.

For now…I want to give you time to work on your taxes.  Good luck!

Got a question on how to organize for prep?  Just comment here and I’ll give you the answer!

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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.

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!