This year’s income tax season ended a little over a month ago so no need to worry until next tax season, right? Wrong! Too many individuals put all thoughts of their income tax into the same box/container which holds the copy of their income tax return. Unfortunately, the only thing this action accomplishes is storing last year’s information until it is needed.
Now is the perfect time to plan and prepare for next year. How many of us did not keep copies of receipts which prove deductible items? Too many, according to many sources which track this type of information and without proof the item should not be deducted. What a waste of a potential money saving deduction.
Since what can and cannot be deducted should be relatively fresh in everyone’s mind, now is the time to set up a folder or special place to store receipts until they are needed for next year’s income tax return preparation. Also when placing the receipt into its new home, take a careful look at what is on the receipt. Typically, you might know exactly what the receipt is for now but will you know in another eight months? Next income tax season you will be very thankful you took the time to indicate what the receipt is for directly on the receipt.
It is never too early to begin to plan as well as get organized for the next income tax season; the sooner the better so you have less “backtracking” to do. Initially, getting organized might some time but when next year’s tax season rolls around you will be ready and thankful you took the time to get prepared by organizing and marking your receipts early. Just remember to keep up with marking, organizing and keeping your receipts as the year progresses.
Submitted by Kathryn Shrader, Postema Accounting Solutions
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