Organizing Your Tax Documents

As tax time approaches it is important to keep your paperwork organized. A simple approach is to keep a two pocket folder handy as your 2011 tax documents come in. File them there as soon as you open the mail. As you gather receipts and other documents for your tax returns put them in also. I keep receipts on one side and tax forms (W2s, 1099's etc...) on the other.  If you have a large amount of paperwork to prepare your returns you can use an accordion file and designate the first pocket for tax forms. I promise this will put a smile on your accountant's face.

Now is a good time to set up a system for 2012 as well. The most important
thing is that you gather all your receipts in one place. I prefer the pocket
folder or accordion file but a shoe box or envelope can work if that is what you prefer.  Just be sure to flatten each receipt out and group them by category or month.

The quicker you get your paperwork together that faster you can get that refund.  Of course if you owe it is still nice to get the returns done early so you know what you are in for.