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Organize those records
By Glenice Johnson
From eNews, February 23, 2006
With tax time approaching, people are gathering the documents and receipts necessary for filling out their income tax returns. Some people can easily find such papers in an organized home-filing system, while others search frantically through boxes, drawers, bags, and vehicles. If you find yourself in the latter category, use tax time as an incentive to organize important papers.
Begin by pulling out all those records and papers you have stored in various places and sorting them into categories--unpaid bills, receipts, insurance policies, medical and legal documents, and all your records for banking, real estate, vehicles, education, and employment.
Rosemary Heins, a regional educator with the U of M Extension Service, says too many Minnesotans miss out on important federal and state tax benefits because they're unaware they qualify or don't know how to claim them. To hear more, listen to University of Minnesota Moment.
To learn more about the U.S. tax system, visit the U of M Extension Service or read "Info U: help with taxes."
Next, set up your record-keeping place. It can be a two- or four-drawer filing cabinet, a portable file box, or accordion folders. Divide it into:
- "Current files"--for items such as unpaid bills, paid receipts, bank statements, credit card information, and employment and benefit records.
- "Permanent files"--for ongoing records needed for reference and updating changes. This includes investments, property records, loans, insurance policies, family health records, employment records (including benefits, retirement plans, and Social Security), appliance manuals and warranties, income tax papers, household inventory, and copies of wills and other legal documents.
- "Dead storage file"--for records that are more than three years old, such as income tax returns and records, property records, and legal transactions/documents.
Use a safe deposit box for papers that are difficult or expensive to replace: birth, marriage, and death certificates; divorce decrees; wills; deeds; property abstracts; stock certificates; vehicle titles; military papers; and passports.
Finally, develop an index or "roadmap" to your filing system--list important contact people, such as your employer, banker, attorney, insurance office, doctor, and family member. Share your system with other household or family members so they can find essential information quickly in the event of an emergency.
Glenice Johnson is a family resource management educator with the University of Minnesota Extension Service Regional Center, Crookston.