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Personal | Business
Done your taxes yet?
It’s a fair wager that filing taxes, the annual task that American households face between January and April 15, is no one’s favorite. But as they say, death and taxes are two things that no one can avoid.
So how do you file? Do you prepare the tax forms yourself? Do you use tax preparation software like TurboTax? Do you rely on a tax preparation service? Hire an accountant?
No one likes doing their taxes. But after preparing them myself for more than 20 years, I’ve found a trick that makes getting ready to do them a lot easier. And being ready to do them is the best cure for procrastination.
In our house, we have what we call “The Tax Bag.” It’s actually a large cloth bag with handles that hangs on the back of a seldom used interior door in our house. It never moves from that location until it’s time to do the taxes. And both my wife and I know exactly where it is and what it’s for.
When we receive a form in the mail that relates to taxes, it goes in the bag. When we get an acknowledgement letter from a charitable organization, it goes in the bag. If we take clothes to Goodwill and get a receipt for our donation, we make a note of the contributed items and put it in the bag.
Getting all the receipts and forms together in one place avoids the mad scramble to find them at tax time. It’s then easy to sort and group the forms into categories – income, deductions, charitable contributions, medical expenses, retirement, etc.
The bag works even if you take your taxes to someone else to prepare. Getting all the information together is at least half the battle.
Being frugal was never a habit I had to work hard to learn; it came pretty naturally to me. But as I’ve gotten older, I’ve seen more and more how money influences the decisions we make in life. I believe everyone has good ideas for reducing spending, saving money, or stretching dollars. I hope my blog posts will spark some ideas of your own.
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