Organizing Papers for Year End

We’re officially 52 days until the end of the year. With the holidays nearly upon us (actually some of my clients mark Halloween as the official start of the holiday season), it’s easy to let important paperwork slip. I’ve found that if you spend a little time before the end of the year organizing papers, it makes tax time easier and less stressful.

Here are a few simple things you can do between now and New Year’s Eve:

  • Make a habit of going through any papers that tend to stack up. Back in August we talked about setting a daily or bi-weekly routine to head this monster off at the pass. Now that the election clutter will stop clogging up our mailboxes, be sure to sort out the trash, things to shred, stuff to file and items that need attention.
  • If you didn’t create a tax file at the beginning of the year, start one. Begin organizing papers and collecting items you know your tax professional will need. Refer back to the tax organizer your CPA sent you in previous years, or review the back-up documentation from 2011’s tax file. Unless your situation has dramatically changed, chances are you’ll have the same type of items to collect for your 2012 tax bill.
  • Don’t wait for spring cleaning to look for easy items to donate. The holiday season is when charities need your donations (cash or otherwise) the most. Making a run to your location donation drop-off will reduce clutter and make you feel good. Then, file those receipts in your 2012 tax file.
  • If you haven’t already contacted your tax professional to do a little pre-tax planning, schedule it. 30 minutes planning now for next year’s tax bill can save you from unexpected surprises as well as the headache caused from knowing you could have made simple changes with big payoffs.
  • Make a commitment on how you’re going to handle your financial life in 2013. Think of the good habits you’ve established — like regularly organizing papers before they have a chance to become the leaning Tower of Pisa in your home office. Acknowledge the positive changes you’ve made, then set realistic goals of what habits you want to create in the new year.

What other end-of-year rituals help you get organized?

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