The Hello Bar is a simple notification bar that engages users and communicates a call to action.

Spare Yourself the Tax-Time Headaches: Set Up an Easy System for Sorting Receipts

Having a system for managing receipts and other financial expenses is essential if you are audited, here’s how to prepare by tracking your invoices and receipts.

Use a storable accordion file to keep track of your expenses.

 

Tracking invoices and receipts is an essential task—not only for your own record keeping but also for the IRS. In case you ever get audited, the IRS wants to know that whatever you have claimed on your taxes matches the records that you have kept. Having a system for managing your receipts and other financial expenses, write-offs, etc., is important.

The easiest system I have found for managing this type of information, if you are keeping the paper versions, is an accordion file. Accordion files can be  purchased at any office supply store; be sure to get the style that is labeled 1 through 31 and that has a flap, so it can be closed. You won’t actually use the numbers; instead you’ll re-label each of the slots for each of your expense categories.

Think about the different types of expenses that you have during the course of a business day. You probably have expenses for meals and entertainment, office supplies, internet access, business phone, cell phone, maybe office rent—each of those categories gets a slot in the expense accordion. As the year goes on you can simply drop those expenses into the corresponding slot in the accordion. When the year is over, you can quickly and easily add up the expenses within each category and give the totals to your tax preparer. When

tax time comes, you’ll spare yourself the headache of sorting through a box of miscellaneous receipts or the needless expense of paying your tax-preparer to do it for you.

Each year you would create a new accordion file labeled with the corresponding year. At the end of the year when you have your taxes prepared, put your tax return in the front slot of the accordion. Seal up the flap and archive the entire thing. This way if you ever were to be audited, you have not only the tax return but all the supporting documents at the ready.

Tagged with: documentationEfficiencyPaper ManagementReceiptsTaxes
 

5 Responses to “Spare Yourself the Tax-Time Headaches: Set Up an Easy System for Sorting Receipts”

  1. Gabrielle says:

    If you’re a sole proprietor, use IRS Form 1040 Schedule C to set up the categories of expenses.

  2. Neon Light : says:

    we alway get our office supplies from a very reputable dealer that lives close to our home“;

  3. John says:

    I’ve used the accordian files and it works for home and business receipts. There are now websites that help organize electronically like expensify.com and shoeboxed.com

  4. Jarod Rhyner says:

    How do I copy Firefox bookmarks between users on the same computer?

Leave a Reply




415-830-6345
310 Townsend Street, #308
San Francisco CA 94107
info@customlivingsolutions.com

© Custom Living Solutions, 2003-2010.
ERROR: 8 - CURL error: Couldn't resolve host 'customliving.infusiontest.com'