Tax Season is upon us again. Please tell me that you have done your tax preparation. DO NOT let this task get the best of you yearly. It is really a shame to file late, or to panic and fill bags with helter-skelter receipts that you don’t even have a clue about.
Do yourselves a huge favor and buy a piece of software like QuickBooks. If you simply run a household, it will work miracles. ALL you’ll need are about 15 minutes per week.’
You enter EVERY penny you spend, as well as your income. That’s all. You are done.
Buy a few filing folders. Categorize them by the stuff you need to keep, which counts for your taxes.
A few folders should be: Home Insurance, Mortgage Payments, Postage-USPS/UPS, Automobile expenses (gas, service, and insurance), Medical expenses (should include your health insurance), Clothing, Bank account statements, Utilities (TV, electricity, water, gas, trash), Phones, and Charitable Donations. If you have a home office, then add a file for Office expenses (printer cartridges, paper, pens, etc.).
Enter everything into QuickBooks, including groceries, charitable donations, deposits and withdrawals to and from your Bank account.
THROW AWAY grocery receipts and anything that does not apply to your CPA’s needs. The rest, you need to keep for three years. Once you have collected three years’ worth of files, and then start your fourth year. On the fifth year, you throw away everything from year 1. In other words, you ALWAYS have in hand 3 past years and the current year of files with receipts and statements.
It is really simple. Teach yourself to get into this routine. You will feel so much freer, so much more organized that your CPA will thank you for it.
On January 1st, simply print out your last fiscal year, mail it to your CPA without any other papers and guess what? YOU ARE DONE.
If you are employed and receive 1099 or W2 forms, then you have to wait until January 31st to receive those, because you have to hand those to your CPA as well.
If you have a business, I am sure that you have a bookkeeper in your team, whose responsibility is to have all that in order for you and mails out all the necessary tax forms for your employees and independent contractors no later than January 21st, so that everyone can have their tax documents in order.
All it takes is some organizing, some determination and a piece of very helpful software.
If you take those very simple steps, you will breeze through tax season each year and avoid headaches, problems, stress and frustration.
If you need bookkeeping help, you can contact me through my page: www.facebook.com/MariellaStockmal1