Rather than driving yourself crazy doing your own taxes, use these six tips to sorting, categorizing, and printing your receipts and online work payments completed. Doing this will help when filling out the forms for your taxes.
Sort and Categorize Your Receipts
Sorting your receipts by categories, you will save yourself time when doing your own taxes. If I forget which item goes into which category, I will look at the previous year’s Schedule C (business deductions) and Schedule A (itemized deductions that aren’t on Schedule C).
Make Copies of Your Receipts for State and Federal (Snail Mail Filing)
When I make copies of my receipts, I make two copies. One to mail to state and one to mail to federal because I always send in copies to each place. Then, I keep the originals for my own copies of tax returns.
Adding Your Receipts
I always add my receipts twice to make sure I didn’t add an amount more than once or missed one altogether. This is important so you aren’t over or under paying your taxes. I do add a calculator tape to each set of receipts since I send mine in by snail mail. Then, I write which category it belongs to on the calculator tape. Since I don’t have a desk calculator, I use an online one and print that one out. I use calculatorsoup.com as my calculator.
Staple the Calculator Tape to the Receipts
Stapling the tape to the receipts, I can make sure the correct total goes with the right category. Not only that, I can also compare previous years expenses that are tax-deductible to see why there is a difference between tax payments or refunds.
Printing Freelance Payments from Online Sites When a 1099-Misc or 1099-K isn’t Sent
Any independent contractor or freelance worker can print their payments on work provided from the web site they are being paid from when payments are deposited into a checking account. This is proof you were paid from them.
For those who have payments deposited into Paypal and don’t meet either the $20,000 or 200 transaction threshold for a 1099-K can print the payments or download into excel spreadsheet or by each payment received page. If you are sending your returns by snail mail, you will need to print three copies. One for you, state, and federal.
Categorizing and Adding by Company and Website
You will do this the same way I mentioned for your receipts. Why? You will need to enter each company on a separate line since they will be sending the information to the IRS. Plus, it will help you see which places you are making the most money from.