Getting Organized for Tax Season

It may be the middle of  January right now, but April 15th will be here before you know it.  Getting all of your tax related paperwork in order can sometimes be a daunting task.  Today Shannon from Love Your Space shares some helpful tips on getting and staying organized for the tax season:

Some pitfalls of being disorganized at tax time

  •  You run the risk of misplacing important receipts/documents
  •  You feel stressed from the mad dash to the tax preparer/post office on April 14th
  •  Your tax preparer may charge you more money if they have to spend time wading through your piles of loose receipts.


Set up an all-year round file system

Designate a box, accordion file, or a file cabinet for year-round paper storage and retrieval.   Create folders for receipts, credit card and bank statements, anything you have spent money on or need to keep track of for tax purposes.  As you acquire such documents, place them in the appropriately labeled folder.  This is beneficial not only for tax time but for when you have to retrieve certain papers throughout the year.

Give your tax-related papers a home

Every January, mailboxes become flooded with documents necessary for filing your taxes.  At the beginning of the year, designate a large envelope or box in one area of your home or a file in your file cabinet for these papers.  Examples of these are:

  •  W2’s
  •  1099’s
  •  Mortgage interest statements
  •  Bank interest statements
  •  Real estate tax statements
  •  Investment statements
  •  Receipts for charitable donations

Sort and create categories for your papers/receipts

By early February, you should have received all paperwork necessary to complete your taxes.  Take that envelope/box/file of collected papers and sort them by category.  This process will enable you or your tax preparer to quickly locate your papers and receipts. Some basic categories are:

  •  Salary
  •  Real Estate
  •  Medical
  •  Childcare
  •  Investments

Save your tax preparer aggravation by throwing away the envelopes that your statements came in and tear off the perforated edges from your income statements.  Group the documents into the categories you’ve created and paper clip them together.  Place all of these papers in a folder or large envelope.

Missing something?

If you are missing a W-2 form you can ask your employer to send new a copy of your W-2.  Some employers charge a nominal fee for this service.  Employers are required by law to keep copies of your W-2’s and other payroll information for at least four years.

If you are missing a 1099 form, banks may have tax documents available for downloading from their web site, or you can call their customer service number to get a new 1099 mailed to you.

Your broker will be able to mail you a copy of your 1099 to report stock trading and other investment activity. Or you might be able to download a copy from the brokerage web site.

If you earned more than $600 as a consultant or independent contractor, your client is required to send you a 1099-MISC to report your income. Even if you didn’t receive a 1099, you are still required to report the income to the IRS.

How to Obtain Copies of Your Tax Documents from the IRS

The IRS receives copies of all your tax documents. You can easily obtain copies of them by mail or fax.  You’ll need to fill out Form 4506-T to request your income documents.  This form is used to request transcripts of various tax documents.  To request the income documents, check the box for line 8, “Form W-2, Form 1099 series, Form 1098 series, or Form 5498 series transcript.”

The information will be mailed to you, and it will be a computer printout of the information contained on your various income documents. One word of caution: the IRS only retains the federal information on these forms. State and local information, such as state withholding amounts, will not show up on this transcript. After obtaining the transcript, you may want to contact the institutions shown on the transcript to obtain a copy of the original documents.

The IRS keeps your tax documents in their database for about four years, and up to ten years of documents might exist in their archives.

What to keep and for how long?

Want to throw out old tax information from years past?  You can toss anything that’s three years or older when it comes to data for your tax return, but always keep the W-2s, 1099s, and a copy of your actual tax returns in a clearly marked file (i.e. Tax 2009-Joint File) for safekeeping.