How should I organize my paperwork for filing my tax return?

    Published: 06-16-2009
    Views: 16,262
    Tax Director Art Auerbach discusses how to organize paperwork when filing a tax return.

    Host: How should I organize my paper work for filing my tax return?

    Aurthur Auerbach: Where most folks who sit down to prepare their own tax return get into difficulty is we as or I will just give you a general statement as somebody who has been in this profession over 40 years. In my own humble opinion I think most American taxpayers pay more taxes than they have to for the very simple reason is that we are the world's worst record keepers. We refuse to write anything down, when you save receipts they get dumped into the typical shoe box or a paper bag and now you are going to prepare a tax return and outcome is everything else, it gets dumped on the table and you are going to try to go through this one piece of paper at a time. That's why this question is here about organization.

    Sort your papers out, what is income? What are deductions? If they are in the deduction category, which deduction are they? Remember there are basically five or six major categories that we will get to - medical expenses, charitable contributions, interest expense, taxes and miscellaneous. So if you organize your papers in that fashion then if you have or if you are on a computer and there is a tax program in front of you it's going to ask you the very questions that I just said. Do you have medical expenses? You answer, "Yes" then it goes to the next screen, "Did you go to the doctor, Dentist, Optometrist?" You pick your receipts and you enter the information. So if you organize it by category, category of income and category of deductions you are going to find tax return preparation is going to go a lot smoother.