Paperless Home: Taxes

+ I’m going to take a stab at helping you simplify your taxes, or at least offer a few suggestions to help you feel more organized and less overwhelmed. I won’t pretend to be an accountant or financial advisor so please research any questions you have. This is what has worked for our home to make things simpler and paperless!

When I was younger, I used to love doing my taxes (by hand!) with little income and fewer write-offs. Filling out forms and matching numbers was my thing... yeah, I was cool. And then in my mid-twenties, I became a contractor with variable income and investments. Hello, accountant. And then there was the year I changed careers, got married, moved across the country and started house-shopping. My taxes and the materials to support them have become much more complicated but my system for organizing them hasn’t.


1. Find out what you actually need to keep. Do research and ask an accountant, for this year and next, what is worth organizing and storing. Don’t keep receipts that will serve no purpose. Freelancers might need to keep a lot of receipts but most people don’t, especially if you’re not itemizing. (I've mentioned that even with my illness, it wasn’t worth it to keep medical receipts for tax purposes.) The advice varies from person to person and changes every year. Here are a few resources that can help on itemizing and business expenses.

2. Keep all tax paperwork in one place. Get one large folder, label it with the year and “Taxes” and put any and all tax-related paperwork in it. The more you can do this digitally, the better. We used to keep a physical folder and now we do the same thing digitally in Evernote (my business receipts) and Dropbox (our household taxes, above). To be more aggressive about ditching paper receipts, I just use Evernote but there are more fully featured apps out there like Receiptmate, Expensify, or Shoeboxed. (Maybe I’ll try each of these out for a month and let you guys know my favorite. Stay tuned!)

3. Collect statement emails in one place. Save all emails regarding tax statements (banks, loans, brokerages, donations) to a tax-labeled folder in email or download each as soon as you receive it to a folder on your computer. Similar to the paperwork, you’ll know where everything is when you get ready to do your taxes.

4. Gather everything and fill out any necessary forms. Now that all of your tax-related stuff is in one folder or one paper folder and one digital folder, it’s simple to gather everything together. Your accountant or tax software might require you to tally some information including income and write-offs.

5. Send everything to an accountant or go online with your favorite tax-prep software. You should have everything you need to make your taxes as simple as possible. If an aspect of this process was complicated, take this time to ask your accountant what you can do differently for next year. File and smile!!

+ On storing taxes: we have a shoebox with the last seven years of returns but are working on shifting current years to digital so storage will be even safer.

+ If you dread tax-time because of a fear of owing... take this opportunity to set up a system to save more for next year. The money you owe wasn't your money to begin with... it was always going to go to the IRS. Set up an automatic transfer right away to a savings account so you don’t see that money and consider spending it.

Paperless Home: Bills & Statements

After removing junk mail and catalogs and magazines and newspapers, the last major source of mail is bills and statements. Yay?! This is not the most exciting topic but they do tend to overwhelm us.

1. Reduce your bills. Like all essentializing, the first step is to stop adding to the problem. If you have a bunch of bills lying around, gather them all together and sort by kind so you know what you’re dealing with. Are the bills for essentials? Are you open to cutting cable or combining your mobile account with a partner or roommate? Are you in a place that you can afford all of those $5 and $10 monthly expenses for media? Bill paying is much easier when you have fewer to deal with!
2. Go paperless. Almost every company promotes paperless statements sent via email. It’s usually as simple as logging into your account and selecting “paperless”. Email statements are easier to track, searchable, and easier to keep indefinitely.
3. Online bill pay. Set up one place to pay all of your bills online. (I do it through my bank but there are other sites that offer a similar service like Mint Bills.) I prefer manually paying them through the site instead of setting up automatic payments. I’ve found that when on a budget, I have more peace of mind being aware of the cost of each bill. It’s amazing how many times a fixed bill amount (like Comcast internet) goes up when we're not paying attention. Since I view each bill in relation to the last month's, I know very quickly when an error has been made.
4. Input statements digitally. Similar to receipts, if I receive a statement that just needs to be reconciled, I’ll enter or scan it digitally: expenses to, medical statements to Google Docs, tax items to Evernote, dated items to Calendar, and to-do’s to Asana.
5. Paper bills to physical inbox. After the effort of making most bills and statements digital, I still receive a few bills in my mailbox. They go right to my physical inbox to be opened and dealt with only once a week!

(paying bills online, once a week!)

(paying bills online, once a week!)

Have any of you changed your relationship to mail? Do you now have less paper and a lighter mailbox?

+ If you’re in a place that you can’t afford to pay your bills, a more involved system might be necessary temporarily, or you can consider an overhaul of your finances and budget. My goals are simplicity and less waste but you might have different needs!

+ I don’t feel the need to keep any paper versions of statements or bills. Most of the companies and banks I deal with provide access for a few years or I can download and store them in Dropbox. This helps our home stay paperless. If you’re unsure about what to keep for business or tax purposes, please ask your accountant!