Organization Counts

Are you a shoebox?  No, not you personally. Your tax stuff. Do you just put all those receipts and little scraps of paper in a shoebox? It's truly not efficient and you are most likely missing out on some deductions. Here's why: 1) when it comes to tax time, you don't remember what half the scraps of paper mean; 2) the business receipts, which are supposed to document the person and event - don't; 3) you probably put half the receipts in a different shoebox which you then forgot about and which will resurface in 10 years when you clean out your closet.

Don't Be A Shoebox

I used to know someone so compulsive about recordkeeping that he would enter every last penny into Quicken.  If I went to the ATM, my quicken report would just show "cash - miscellaneous $100". His Quicken report would show exactly how that $100 was spent, down to the penny. You don't need to be quite that bad. Quicken, or any other bookkeeping software that you will actually use, is a great start. If you are diligent, at the end of the year, you can print your tax report in about two minutes. If you are not the computer type, you can still be just as organized. It just takes a little time and effort on your part. Here's how: 1) get yourself a multipocket folder; 2) label each pocket with the different types of income and deductions you have; 3) before you put any slip of paper in any pocket, label it - make sure it has the date and amount - if it relates to a business meeting, it also needs the name of the person you met with and the business purpose of the meeting.

The Longer You Wait, The More Organized You Need To Be

The closer you get to April 15 before doing your own taxes or giving your information to a professional preparer, the more organized you need to be. No one has time to spare going through the shoebox on April 14. Spend your time wisely. Even if you only organize a little at a time, make sure you have it pulled together before actual return preparation starts. It's much more efficient if you don't have to stop and go find something else.

Remember, it's your money. If you miss out on deductions, it costs you. Shoeboxes are for shoes. It's time for an upgrade.