You’ve gone ahead and filed your taxes for this year so now it’s time to move onto the next item on your to do list. But why not prepare for next year now? Even though a year from now may seem like a long time, focusing on how to prepare for tax season for the following year will hopefully prevent stress.
Organize Your Financial Records
By taking the time to organize your financial records now, you will likely prevent frustrations in the future. Keep track and receipts of any large donations throughout the year or of anything you think may need. Saving those items now, will make it a lot of easier on yourself when you file your taxes the following year.
Tax Preparation Checklist
You have checklists for everything else, why not one for your tax planning? There are a few steps that you should consider having on your checklist to be prepared.
Records to Keep
There are a few documents you should keep that can be helpful. You’ll want to hold onto any receipts or documents from:
- large purchases
- college financial records
- car title or registration paperwork
- charitable giving receipts
- home mortgage paperwork
- home renovation receipts
- personal certificates/paperwork
How Long Should I Keep It?
Items you should keep indefinitely and keep in a safe place:
- Birth, death and marriage certificates
- Adoption records
- Citizenship and military discharge papers
- Social security card
Items you should keep longer than a year:
- Tax returns (and supporting documentation)
- Mortgage contracts
- Property appraisals
- Annual retirement and investment statements
- Receipts for major purchases and home improvements
Items you can keep for one year or less:
- Bank or credit union statements
- Credit card statements
- Utility bills
- Auto and homeowners insurance policies
Where Should I keep everything?
Whatever items you are keeping, it’s important to keep them safe and protected. It’s best to keep important documents in a fire-resistant file cabinet, safe or safe-deposit box. If you are able to save these items digitally, doing so can help save you time and space. When keeping items digitally, make sure to have backup copies, a secure password and a reliable cloud storage device. It’s important to also make sure you have a good organizing system that works for you but is also will help you find documents easier whenever you need them.
Support You Need
Everyone’s situation is unique, and you may have specific questions that you need help with. Contact a Farm Bureau financial advisor if you need help planning for your financial goals.
Neither the Company nor its agents or advisors give tax, accounting or legal advice. Consult your professional advisor in these areas.