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4 Steps to Get Organized for Tax Season

No matter what resources you use to prepare your tax return, it takes work to collect the data and forms you need to complete your return.  Not being able to find information or access forms when you’re ready to get to work on either preparing a tax workbook for your CPA or doing your own return turns an already tedious project into an overwhelming, frustrating and time-consuming one.  It doesn’t have to be awful.  There are steps you can take to get organized and prepared so that next tax season you can reduce your stress and impress your accountant.

  1. Know your tax preparation tool.  Knowing what information you need ahead of time helps you know what data to collect over the year and informs what type of system you can use to collect it.  Take a look at the IRS forms you use, the TurboTax questionnaire or the tax workbook created by your accountant and use it as your guide for the next step.
  2. Make a Tax Preparation List.  This list should capture the information you need to use your tax prep tool.  This list is likely to include items like: W-2, interest income, qualified medical expenses, interest paid on a mortgage, etc.  Include on your list the data you need and where you can find it.  If you access information from online accounts, write down the URL.  If you’re not using a separate system for password management like LastPass or another document you’ve created, consider adding the login credentials to this list.  While making this list you may find you don’t know where to find the information you need.  Leave these spaces blank for now.Screen Shot 2015-03-24 at 2.13.40 PM
  3. Set up Collection Points. Now evaluate your list to decide how to collect the information you need to prepare your tax return.  Start simply.  The key to organized data collection is making collecting information as simple as possible.  For many people this simply means having one folder in a place where you process mail to capture relevant tax forms and receipts.  The idea here is that it’s easier for you to quickly sort out a folder of paper when you’re ready to prepare you taxes knowing that it’s all in there, than looking in a variety of places trying to find what you need.  If you do a have a more complicated return, it may make sense to have a few folders:  Tax Prep, Tax Prep – Medical Expenses, Tax Prep – Business Related.  Again a key is to have these folders in a place where it is easy to drop in new items.
  4. Update your Tax Preparation List.  Now that you’ve assigned collection points for your tax prep information, update the list you made in step 2.  Put your updated list in your Tax Prep folder. If you’ve created this list electronically, print a copy and put it in the folder.

Now you’re organized and ready to collect and find the information you need to prepare your next tax return.  Need help setting up a system for tax preparation in your home or office, contact us to for consultation, training and hands-on support.


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