This article by Denise Landers, founder and CEO of Key Organization Systems Inc. and a Paper Tiger Expert, will help you get ready for tax time, get your filing system in order, and help you decide what you need to keep. Denise also recommends The Paper Tiger Document Management and Filing System software to help keep track of all your paper files throughout the year.
What do I have to keep and how long should I keep it?
It’s the perennial dilemma as you survey the year’s accumulated stacks of papers, miscellaneous receipts, and overflowing paper files. You want to get organized and use good document management, as well as time management skills, but do not know where to start. Whether it is for office organizing or home paperwork, you face the challenges of making a decision.
As more and more becomes available through the internet, the quantity of accumulated paper should be diminishing. After all, you can view your brokerage reports, reconcile monthly bank statements, and pay your bills without ever handling the actual paper. However, even if you have been switching to electronic transactions, it is often tempting to print out these transactions and reports, adding them into your paper filing system.
Start now to make decisions on what does not have to be stored. Get ready with a good cross-cut shredder and begin the clean-up process. You can toss:
1. Receipts from banks deposits and ATM transactions. Once you have reconciled your monthly statement and all of these transactions are accounted for, the slip can be discarded.
2. Bills, such as utilities, cable, and telephone. If your check has cleared, why are you holding onto the actual invoice where you recorded the check number and date of payment? The canceled check itself verifies receipt of your payment that month.
3. Canceled checks. Store only the ones that relate to tax items you will be declaring. For example, if you are claiming a home office deduction, you do want to keep a record of utility payments for which you will be claiming a partial deduction. However the personal Wal-Mart check for miscellaneous household items does not need to be kept long-term.
4. Brokerage statements. If your annual statement summarizes all of the year’s activities, you can eliminate the monthly and quarterly ones from the past.
5. Pay stubs. Once you have verified the end-of-year amounts with what is shown on your W-2, toss the monthly stubs, retaining just the final one of the year with the totals.
6. Receipts for purchases. If the item is not under warranty or is not for a major purchase that you will include with a household inventory list, you can let those go. For example, if you bought two shirts in June and have been wearing them on a regular basis, why would you want to file that receipt?
When you just want to retain something for a short period rather than placing it into your permanent files, you can create a monthly system with file folders for January through December. Use this as a temporary storage place. Once the next January comes along, toss all those “temporary-hold” items.
Following this process makes it easy to do an annual review and get ready for the upcoming income tax tasks.
If you would like to jumpstart your organizing efforts and add to your time management skills, we can help!
Corporate Training: workshops and consulting to increase daily work flow and reduce stress.
Individual Assistance: our onsite and virtual office organizing to bring about changes quickly.
On Your Own: books and CDs to work at your own pace.
More time management articles by Denise Landers