If you're like many Americans, April is a grim month, full of remorse for past behavior and foreboding about the inevitable. No, it's not Bathing Suit Anxiety Disorder—we're talking about the collective panic-attack known as "tax season."
Boxes of messy receipts, missing forms, lost statements—why does it have to be so painful? While we can't take the work out of tax preparation, we can help you avoid the last minute nightmare. Our professional advice: Set up a Tax Binder to organize your year's tax materials as you go. With a few russell+hazel tools and some monthly maintenance, it will be smooth filing come April '08.
Put It Together
1. Designate a Signature or Slim Three-ring Binder as tax prep central.
2. Snap in 8-tab Index Dividers to categorize your tax information.
3. Label the tabs by category: employment; business expenses; home/property; donations, etc.
4. Add a Paper Pocket at the front of your binder labeled "To be filed" and another at the back for last year's return. Add Paper Pockets within each category to hold receipts or other materials that can't be hole-punched.
5. File your tax materials as you go: Three-hole punch your full-size pages and clip them in; date all receipts and file them in the appropriate pocket. Use the "To be filed" folder sparingly—empty it regularly or the task becomes overwhelming. Finally, file a copy of last year's return in the back for easy reference.
6. Tax Binder in hand, you (or your tax preparer) have everything you need tied up with a pretty rubber band. After filing, stash the binder in storage. Refund spending spree, anyone?