Tax day is still over two months away, but February is the time when all those important pieces of paper you’ll need to do your taxes start showing up.  Take a little time now to create a system to get your papers organized so that when it’s time to give it to the accountant, or sit down and prepare them you can be a little less stressed. 

1) Gather Your Stuff

Create a spot right now to gather those important pieces of paper. Grab a hanging file and label it “Even Year Taxes”.  I prefer a hanging file to a file folder because it’s larger and stays neat as it fills up.  Drop in your W2s, 1099s, receipts, interest statements etc... as they arrive. Why “Even Year” instead of “2016”?  When your taxes are all done, you can take all the papers you used to prepare them out of it and file them with your 2016 returns and the folder is already ready for 2018.   Now, let’s get ahead of the curve. Create another file called “Odd Year Taxes”.  Start using this one right now to prepare for next year’s returns.  Throughout the year, you simply drop in your tax relevant receipts, medical bills, etc. and next year your taxes are even easier. This is one of the techniques of the Freedom Filer system of which I’m a big fan. It’s a way to create files that essentially clean themselves out year after year. If you are not a filing cabinet person - a desktop file or magazine style file can serve this purpose too. 

 2) Get End of Year Statements

Most credit card companies will prepare an end-of-the-year statement for you that has all of your expenses broken down into categories.  Much easier to review that for deductible expenses then looking at every single monthly statement.   But many of them will only send them to you if you request them, and it takes them a little while to deliver.  Now’s the time to put in that request.  

 3) Engage the Tax Preparer

Imagine being an accountant in April.  Most people are procrastinators, especially when it comes to the slog of preparing to file taxes.  Many tax preparers will give an early bird discount for people who submit their materials before March.  If you’ve got your stuff together, save a little dough and your accountant’s good side - maybe that refund could be a little bit bigger.