Year-end Records Tips for Tax Filing

For some, the end of December brings the need to de-clutter and reorganize their lives before the new year. Unlike many habits, this practice is one people should pick up, especially when pertaining to tax records. TurboTax offers several tips for year-end records and tax filing that can help make April a little easier.

The first tip is to start tracking paperless records as they arrive. Create a spreadsheet dedicated to tax records, and don’t forget items like expense titles, check numbers, payee names, dollar amounts and dates. Also be sure to track potential deductions such as charitable donations, outlays for health care, job-search expenses and unreimbursed work expenses.

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Next, try to think about deductions throughout the year, especially with life events you experience. Maybe keep a mileage log in your car to record the miles you use for volunteering, work, business or medical appointments. Be sure to keep cash receipts that document transportation, charitable work, job-search and other tax-deductible activities. Also, keep documents related to events like the birth or adoption of a child, marriage, death of a spouse or divorce, and buying a home.

Tax returns and supporting documents should be kept for at least seven to 10 years, but consider shredding anything past then. Creating a system for tracking and organizing your tax records, potential deductibles and other documents, while updating it throughout the year, will help make the days leading up to April 18 a little less stressful.

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