Pre-Plan for a Productive Tax Season
I love filing my taxes! — said no one ever. There’s something poetic about the transition from the season of giving to the tax season… but we’ll leave it to you to explore that metaphor. Though Tax Day is as constant as the world turns, procrastination is rampant up until the final filing deadline. But, with a bit of pre-planning and organization, you can turn the season of paperwork into another to-do done.
If you keep your tax documents in the same paperwork pile as everything else, then there’s an easy fix: stop it. Find a dedicated place to store your tax documents, and only those documents. If you like holding onto the physical papers, and many people still do, pick a box or a file folder and fill it. It should be kept somewhere that’s easily accessible, but also safe and away from nosy roommates or others who don’t share your finances. (By the way, if you have nosy roommates who might elect to peruse your tax documents, consider moving out.)
Do piles of paper give you panic attacks? Same. Time to start turning your physical documents into digital scans. There are lots of scanning apps out there, but we’re partial to the most popular one, Adobe Scan,, for obvious reasons. Snap a photo of any document with your phone and then send the original to the shredder. Multiple pages? No problem. Scan them in a batch and combine to create a single PDF. Missed a page? You can easily add it into an existing PDF whenever you want.
If you’ve bought into the digital document lifestyle by now, keep it going. Depending on the complexity of your tax return, it’s important to label your documents by category once they’re digitized. If you have Acrobat DC, you can easily access your scanned or saved digital tax forms, statements and receipts there. Here are some commonly used categories to get you started:
- Medical expenses
- Charitable donations
- Real estate papers
- Property and sales tax
- Child care payments
- Student loan payments
- Self-employment expense receipts
To organize your documents, open all related PDFs in a desired category (i.e. only open bank statements if you want to start there) and select Combine Files to save them into a single PDF. Once everything is combined, you can rearrange, rotate, or delete any pages you no longer need. Label it, and voila! Now you’ve got all your bank statements in one digital file. Do this for the rest of your important documents and you’ll have a digital filing system that will be easy for you, or your accountant, to use.
An added value of going digital is security and flexibility. Once your document is digital, you can safeguard your personal info by adding password-protected editing restrictions and secure encryption. You can also e-sign and send documents directly to your tax preparer, or the government. Just click or tap to sign and send the documents as a link through Acrobat or as an attachment through a tax prep app.
Make next year’s filing easier
The IRS states that you should keep tax documents for 3 years from the date you filed your original return, or 2 years from the date you paid the tax. If you’re using a digital filing system, then that’s no problem. If you’re using a shoe box, then you better hope you don’t lose or throw away your shoe box. If you’re still not convinced that a digital document solution is the way to go for tracking and filing tax documents, we’ve created an entire page that outlines the top tools you’ll need to tackle taxes like a boss.
Wishing you the biggest refund yet!