Tax and File Organization

April is the month we long for after a cold winter season.  Flowers bloom, the sunshine warms and Spring is in the air!  However, amidst the calm beauty of Spring lurks Uncle Sam who has people frantically scrambling through papers gathering last-minute receipts and statements for tax preparation. Rather than seeing the stress of tax time, let’s look at tax season as the prefect time to “Spring purge” your home files and free up space for the new year.  Next Spring you can actually soak up the sun!!  Here are a few tips to simplify your tax submission and streamline your files to simplicity.

  1. Each January label a file with the current tax year and keep this file easily accessible to file donation receipts, work receipts and anything you gather throughout the year for taxes.  If needed, create sub folders to be more specific in your sorting.
  2. If drawer space is a premium, and you are unable to spare room to file past taxes, purchase a plastic or cardboard file box.  Add hanging file folders and label by year.  Fill each file with pertaining year taxes.  Also, fill the file with all medical, bank, mortgage and misc receipts for that year.  This creates a history for you to reference as needed. This also frees up your file cabinets for the current year.  You only need to hang on to tax statements for the last 7 years.  Shred the rest!!!
  3. Now is the time to clean out all your files!
    • Purge personal receipts for items you will never return (most stores will not accept returns past 90 days).  Read the policy on receipts and toss those you do not need.
    • Make sure you have an Electronics file to store high ticket item receipts i.e. phones, TVs, computers.
    • You do not need to stock pile utility bills. Keep only the most current month for quick/easy reference.
    • All store credit card history can be obtained on-line.  Again, only save most recent bill to ensure any credits due or again for quick reference.
    • No need to save those monthly bank and mortgage statements. If you need to save, file in your yearly hanging files discussed in #2.
    • Streamline your medical files and save by year if needed.
    •  Insurance policies should be shredded once you receive the new policy for the year.

4.  Shred all documents with personal information.  Contact your local township to see if they offer a Spring shredding drop off location. Staples offers a great shred service in which you pay by the pound, and they take stapled papers too!  Well worth it!

The first time you attack this project may take several hours and seem tedious and overwhelming.  But trust me, once all files are purged and streamlined, every tax season will be simplified and your daily paper flow will be seamless.


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