4 Steps to Organizing Your Tax Documents

Buddy Newton, CPA, CVA Tax Manager,

  Filed under: News and Tax Blog

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Organizing Tax Documents: Have a system other than the shoebox

It's that time of year again, but no need to worry! Following these four steps can make gathering the files needed for your tax return less stressful and more efficient.
 

 1.  Collect and organize tax documents.

 
Develop a filing system that works for you.  Whether it’s a simple manila folder or a multi-file box, place all tax documents in a specific place instead of laying them on a table or counter where they can be easily misplaced.  It’s never fun trying to get an additional copy of a government issued tax form.  
 
Tax forms usually come by mail, but as the world has become increasingly technologically advanced, more and more tax forms are being delivered electronically.  Therefore, it is important to check not only your mailbox, but also log in to your e-mail account to check for any tax forms that are delivered electronically.  
 
If you itemize deductions on your tax return you will need to gather additional documentation.  The major categories of itemized deductions are as follows:
 
  • Medical Expenses
  • Taxes Paid –  Income & Property
  • Interest – Mortgage & Investment
  • Charitable Contributions
  • Miscellaneous Deductions 
    • Investment Expenses
    • Tax Preparer Fees
    • Unreimbursed Business Expenses

  2.  Read and complete the Tax Organizer.

 
Stockman Kast Ryan and Company mails tax organizers to all of our tax clients during the month of January. These organizers contain questions surrounding taxable events that could have occurred during the tax year and detail income and deductions from the prior year return.  This is a great starting point to use the prior year return information to see if you missed anything while collecting tax forms. We also suggest using  the questionnaire piece of the organizer to help identify any events during the tax year that would have caused taxable income or deductions.
 

  3. Deal with missing information and do so early.

 
As you collect tax forms and review your organizer, it is good to develop a list of missing items. While working on collecting the missing pieces you should schedule your tax appointment. It is better to do this early rather than later because by sitting down with your tax preparer, not only could additional issues be found, but the discussion on whether to extend the tax return can be evaluated. Extending the tax return while waiting for open items may provide peace of mind.
 

  4. Send information and missing pieces securely.

 
Cyber criminals continue to find new ways to commit identity theft. Tax forms are filled with personal information and should be transmitted with care when done electronically. The safest way to exchange documents is via your SKR+CO Client Portal.
 
By following these 4 steps gathering your tax documents and submitting them will be less of a burden. Not only will you feel more organized, but your tax preparer will appreciate your effort!
 
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Buddy Newton, CPA, CVA Tax Manager
Buddy has been in public accounting since 2008 and specializes in serving auto dealers and construction clients. Learn more about Buddy here. He's on LinkedIn here.