![]() ![]() Then, he or she can add it to the proper tax deduction category on your form 1040. ![]() When tax time rolls around, you can provide the tax documents to a tax professional. You could simply get a folder for each tax category, such as:Īnytime you get a receipt that falls under one of those expense categories, you would simply place it in the corresponding folder. Instead of rummaging through a box of every receipt you’ve ever gotten, we recommend a filing system. Not to mention the stress it removes when you file your next tax return. While many small businesses opt for the shoebox method, organization can save you a lot of time. If you prefer to keep it old school, you still need to follow some guidelines when saving your records. Should you ever get audited, you could find yourself struggling to provide evidence for your deductions. If you only keep paper receipts in a filing cabinet, then you risk losing them at some point. Since the IRS encourages you to keep records for so long, online storage becomes even more crucial. The IRS advises you to keep tax documents for seven years when filing loss from worthless securities or bad debt. In fact, it is recommended that you keep your tax and return documents and receipts for up to three years. Not only can you digitize paper documents, but you can store your receipts online.Ĭountless cloud-based storage programs exist, so you can keep track of your tax documents for years to come. Thanks to today’s technology, organizing your receipts and records is easier than ever. ![]()
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