The scurrying around of tax season is mostly done and we’re all left to make new resolutions for the good habits we’ll create in 2019. You’ll never magically fall into a tax organization process. Get ahead of next year and determine what you need to save. What stressed you out at tax time last year? If you’re a paper person, make it your goal to free up some file space for 2019 taxes. If you’re tech savvy,  you can look into saving all your login information and important documents on a secure cloud drive. 

  • Pick your team 

Decide on your CPA now instead of the week before your return is due! You can take this opportunity to collaborate with them and your advisor to see what information you need to be saving and what can be ignored. This is also a great time to get on the same page with your spouse and/or dependents.  Schedule time with your financial advisor and CPA in the fall to make sure that you are on track for the current tax year.  Look for opportunities to maximize your tax bracket – you may want to consider a Roth conversion if it is right for you.  Your CPA and financial advisor can help you determine if it is the right time.

  • Standard vs itemizing 

Talk to your CPA about how the new tax law impacts you. Since the standard deduction was doubled, many taxpayers will no longer itemize. Understand what you need to track so you don’t put yourself through extra work! 

  • Track charitable gifting 

Send yourself an email, start a Google document, buy a file folder – it doesn’t matter how you track your gifting, just start now! At the end of 2019, you’ll thank yourself for having all of your gifting documents in one place. 

  • Separate personal and business expenses   

Decide now that you won’t comingle your personal and business purchases. It’ll be much easier to track deductible expenses if they are already separated by account.  Use separate checking accounts and credit cards to avoid comingling funds. Make sure you track mileage for business and/or volunteer work.  You can even use an app to make it easy – I personally like MileIQ.

  • Save & shred

A lot of clients “over save” their paperwork and end up with boxes of unorganized documents. Here is a handy guide to help: 

Keep for a year: Paycheck stubs, account statements, and bills

Keep for seven years: Supporting tax documents 

Keep forever: Tax returns, warranties, proof of purchases, and home improvement receipts

Keep it simple, and don’t overburden your CPA with piles of receipts and papers.  Use software or a spreadsheet to total expenses–your CPA will thank you! 

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