Your taxes are done! So now what? What documents should you keep and for how long? The short version is this: business and personal records to keep forever: income tax returns and payment checks. Records to keep for 7 years: supporting documents for tax returns.
Every year, take the supporting tax documents and put them in a folder or envelope marked with the year. As you store the current documents, get rid of the documents that are 10 or more years old. Keep all of these documents in the same place, a file box or drawer. Keep all of your tax returns together in the same place as well.
Keep receipts organized during the year. The "shoebox method" certainly keeps receipts contained, but seriously...how much precious time is (wasted) spent sorting through them when it's time to get organized? Get yourself a letter sized accordian file folder. Label each section by category - auto, supplies, medical, etc. As you reconcile your receipts each week or month, file them away in the appropriate category. Guess what - when April rolls around again you'll be ready.
For a more detailed list of what to keep, Ramona Creel offers a great set of guidelines.
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