Here is an interesting fact that you should know: while most people assume that they can throw away or destroy their tax papers and other documents after a few years, that is not always true. In some cases, you might be legally required to hold onto all of these documents forever. The minimum period that you will have to keep them is three years. Three years is a very long time to have to deal with an unorganized and slap dash mass of papers and receipts. Even if you are one of those people who can actually get rid of your papers in three years time, isn’t it worthwhile to have them filed correctly for that time period? Paper Tiger Document Management Software can help you get organized and stay organized. You will be rotating papers in and out of your system every single year. Taking the time to get organized once now can save you years of grief as well as possible legal issues.
During an audit, you might be asked to provide documentation that goes back many years. The IRS will not care that you don’t have your papers in a file nor will they give you benefit of the doubt if you say you cannot “find” something. That is not their problem, and they may penalize you further for everything that you do not produce when asked. And, once you have been audited once, your chance of being audited again will increase for many years in the future; making it absolutely vital that you keep the files and papers organized and easy to find. That is where the Paper Tiger filing system is going to become a vital and life saving tool.
Scanning items can be very time consuming and some things just can’t be scanned. By the time you are done scanning all receipts, tax forms and other documents, you will still have to figure out where to store them digitally and a way to find what you’ve scanned. Why bother? Paper Tiger is not a paperless filing system, so you do not have to scan your paper documents. You would simply input the information into the document management database relating to your physical files so that you can find everything that you need with nothing more than a simple to use search on your computer. If you have ever used a search box to look for information, you are capable of using the Paper Tiger filing system.
Imagine that you are searching for documents and receipts for the fiscal year ending 2010. You type that information into the search box and you see the corresponding item number so you can go directly to that file without any time consuming searching or fumbling through drawers or boxes or stacks depending on how you stored them previous to indexing in Paper Tiger. As you cycle new documents into the filing system, you just add new item names and keywords into the database to match your physical files. New files and new documents that are created will fit seamlessly into the Paper Tiger filing system.
And how to archive is simple with Paper Tiger. You would have a Location in your database named ‘Archives’, then simply conduct a Transfer Move of the file or files being moved to the Archive Location within your database. Paper Tiger will assign a file number in your Archives file to move the file to in the physical location. You can archive the previous year’s tax information to a box or filing cabinet in storage room or basement. (wherever you keep the files that you don’t need in your main filing cabinet)
In addition, if you need the same hanging file folders under the same name for the current year’s files, you could instead conduct a Transfer Duplicate to duplicate these files to Archives. Then you would simply change the date of the original file tabs (both in the database and in the physical file location) to be able to have a location for your current year’s files.
To start with Paper Tiger Document Management Software, you would first set up all hanging file folders in your file cabinets at one time using the numbered tabs that you print out from the software and they never change. You input information relating to each document in the database’s digital file location. You can give the document any name you want without any worry about finding it later. This is because the system will allow you to tag keywords that describe all documents that you put into your hanging file folders. For documents that you want to add to the same file, simply edit the Item in the database and add additional keywords necessary for the new document(s). When your physical files have been indexed into the database, the easy-to-use search engine virtually eliminates lost information in your office, as well as eliminating filing the same subject matter under different names because you’ve forgotten what you filed it under previously.
Because the hanging file folders are already setup and waiting for your information, you also eliminate the time-consuming hassle of having to find and create a file folder tab each time you want to file something.
See also our blog post Tax Time Organizing by Deanne Kelleher of Kaos Group for tips on how to get organized for tax time and how to transition old tax files out to get ready for the current year filing system.
Do you also need to know how long to keep records? We have several articles under the Retention Guidelines: How Long Should I Keep Records? category that you might find helpful.
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Tags: document management software, get organized, paper filing systems, Paper Tiger "finding" filing system, tax time
