The first step of good tax planning is good recordkeeping

Recordkeeping of your financial transactions is a key to understanding and enabling year-round tax planning.  Organization makes it easier to prepare taxes and respond to any questions from taxing authorities.

Records help organize:

• Sources of income
• Expenses
• Tax returns
• Documentation supporting the tax return

Generally, the IRS recommends taxpayers keep records for three years from the date they file the tax return.

Records to keep:

• Tax-related records
• IRS letters, notices and prior year tax returns
• Property records
• Business income and expenses
• Health insurance

Further detail - IRS Tip