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ORGANIZING PLAIN & SIMPLE MONTHLY
March 2006
Vol. 4, No. 3

Tips & Inspiration for Organizing a Simpler Life

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It is best to do things systematically, since we are only human, and disorder is our worst enemy.

–Hesiod (Works and Days)

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FEATURE ARTICLE: When is it safe to deep-six tax records?

Guest column by Julian Block

You need no reminder to hold on to your tax records in case your returns are questioned by the Internal Revenue Service. But just how long do you need to save those old records that clutter up your closets and desk drawers?

Unfortunately, there is no flat cutoff. The IRS says the answer depends on what information the records contain and the kind of transaction involved.

It supplements this vague guideline with a cryptic warning: Keep supporting records for “as long as they are important for the federal tax law.” Translated from governmentalese, this means you should save receipts, canceled checks, and whatever else might help support income, deductions, exemptions, credits, exclusions, deferrals and other items on your return, at least until the expiration of the statute of limitations for an audit or for you to file a refund claim, should you find an error after filing. The statute of limitations is the limited period of time after which the tax gatherers are no longer able to come knocking and you cannot recover an overpayment.

In most cases, the IRS has only three years from the filing deadline to take a crack at your return. For example, the deadline is April of 2008 for the government to start an examination of a return for tax year 2004, with a filing due date, for most persons, of April of 2005.

As soon as three years elapse, you could toss out supporting records for income and expenses. Candidates for the garbage pail include W-2 forms, as well as canceled checks covering expenses.

But wait! Predictably enough, nothing is absolutely straightforward when it comes to taxes. There are two exceptions to the three-year test, though they do not apply to most people. Those exceptions aside, there are other situations in which it is advisable to keep documentation for far longer than three years — proof of when you bought and sold investments, to cite a common example. More on that in a moment.

The first exception authorizes the IRS to double the audit deadline from three to six years if the amount of income you fail to report on your return is more than 25 percent of the amount you show on it. To illustrate, the six-year deadline expires in April 2006 for returns for tax year 1999 that were submitted in 2000.

The second exception provides that there is no time limit on when the IRS can come after you if you fail to file a return or file one that is deemed false or fraudulent. The audit, admonishes the IRS, can begin “at any time.”

Copies of returns should be retained indefinitely.
They take up little space and are always helpful as guides for future returns or amending previously filed returns. Also, copies of tax forms may prove helpful in case the IRS claims you failed to file them.

Besides copies of returns, there are other tax-related documents that must be kept until they can no longer affect future returns, which can prove to be much longer than three years. For example, you need to retain records of residential costs, as well as payments for stocks and other investments. Those records are vital, not only because you may need them for an IRS audit, but because you need them to figure your profits or losses on sales that may not take place until many years later.

— Julian Block is a syndicated columnist, attorney and former IRS investigator who has been cited by the New York Times as “a leading tax professional” and by the Wall Street Journal as an “accomplished writer on taxes.” He can be contacted at julianblock@yahoo.com.

Next month: Homemade solutions for spring cleaning

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DID YOU KNOW?

Today (Tuesday, March 14) is Organize Your Home Office Day. Here’s are three ideas that you can work on in 15-minute stages:

– Clear your desktop and put back only those things you use everyday.

– Find a place for everything else.

1. First find a place for things you use only occasionally, such as reference books and catalogs.
These belong in a place that’s fairly close by like a shelf or drawer.

2. Then put away things you rarely need to access such as previous year tax records or papers from a finished project. These can be stored on the top shelf of a closet or in the basement, attic or garage.

– Create folders for filing important papers such as receipts and bills to pay. Store these folders vertically on your desk or in a very accessible desk drawer so you can file important papers immediately.

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SURVEY RESULTS: How do I organize [blank]?

Last month, I asked: If you and I could meet, and you could ask me “What’s the best way to organize [blank],” how would you fill in the blank? In other words, name one thing you want to learn how to organize?

As promised, here are the results of that survey:

– Overwhelmingly, people need help with paper followed by photographs, closets and crafting/sewing/ hobby supplies.

– The rest of the responses ran the gamut from homeschool supplies to purses.

– The rooms in the most need of organizing included office, bathroom, bedroom, kitchen and garage.

– Some specific items mentioned included software CDs and manuals, toys, jewelry, fabric, scrapbooking supplies, and audio CDs.

– One reader responded with a need to organize time.

I wish I could come to your home to help you get organized. But, you do know that you have a chance to “Win Donna for a Day” right?

If you haven’t already, enter to win our “Clean Up and Clear Out” contest. Go to my web site: http://www.unclutter.com. Click on the contest button on the home page for contest details and an entry form.

But hurry. . .the contest ends March 31, 2006.
Good luck!

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NEW SURVEY: Your personal organizing history

Okay. Here’s a two-part question:

1. Were you messy or neat as a kid? 2. Are you messier or neater now?

TO RESPOND TO THE SURVEY, click the following link editor@unclutter.com or send email to editor@unclutter.com with the words “March Survey” in the subject line and your answer in body of the email. I will share the results of this survey in the next issue.

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READERS WRITE: Buttons, buttons…who’s got buttons?

When buying clothes, I always used to wonder what to do with those “extra” buttons that the manufacturer attached to the garment with the tags. I now put them in a jar with a lid and keep a small travel size sewing kit in the jar as well. This way when I lose a button, I can find it easily in my “button” jar, and have a needle and thread right there to sew it on. I keep mine in my laundry room on a shelf.

–Submitted by Elaine Mercer, Dexter GA

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WRITE TO WIN an autographed copy of my most recent book!

Do you have a really great organizing tip you would like to share with other readers? Or a question about an organizing challenge you have?

Send an e-mail to editor@unclutter.com with “Readers_Write” in the subject line.

If your question or tip is included in a future issue of this newsletter, I will send you a free autographed copy of my book, The One-Minute Organizer Plain & Simple. Check it out at

http://www.unclutter.com/books.html

PLEASE NOTE: I get a lot of questions and it’s impossible for me to respond to them all. Please know that I do read them and try to answer as many as I can.

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SHAMELESS PROMOTION: Apologies

I should call this section “Shameful” promotion since I am so late in getting this newsletter to you this month. Hopefully, you’ve had better things to do than wait and worry about when it was coming! I do apologize though. It’s not easy to get everything done when I am traveling.

Because this newsletter is late, I was not able to give you a heads-up on my promotional activities in Memphis, Nashville and Lexington last week. Again, I apologize about that.

I had a couple of book signings at Davis-Kidd and Joseph-Beth Booksellers. I also appeared on several morning news and talk shows including Good Morning Memphis and Channel 3 Live at 9 in Memphis, Talk of the Town in Nashville.

In Lexington, I had the honor of appearing on the same show (WKYT Noon) with Arlo Guthrie who was in town to promote the 40th anniversary of Alice’s Restaurant. I was also a guest on several radio shows: Mornings on Main with Tom & Judy and WLAP with Lee Cruz.

But the most memorable part of last week’s trip was a visit to Winburn Middle School in Lexington and Highland Middle School in Fort Thomas in conjunction with Scholastic Book Fairs. I talked to the students about the life and times of an author until their eyes started glazing over. Then I asked for questions and did I ever get some doozies!

Am I rich? No. Do I have paparazzi? No. <grin> What’s my favorite book of all time? The Count of Monte Cristo.
What was my favorite book to write? The One-Minute Organizer. How old am I? 45. One student said his mother is also 45 but she looks much older. I’m glad she wasn’t in the room.

I am headed to Boston next week for the annual conference of the National Association of Professional Organizers (http://www.napo.net). Then I will head to Miami for a book signing at Books & Books on Sunday March 26 at 6 p.m.
Hope to see you there.

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GOT BOOKS?

For plain and simple tips for cleaning everything in and around your home, look for my new book, Cleaning Plain & Simple in your local bookstore.
If they don’t have a copy, please ask them to order one.

If you are looking for organizing tips, look for my books in bookstores everywhere (including online bookstores) and in select Target, K-Mart, Staples, Discovery Channel, and Lowes stores.

Want a signed copy of one of my books? You can order directly from me:

http://www.unclutter.com/books.html

Click on the SignedCopy.com logo to have a signed copy sent to you.

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That’s it for this month. Until next month, keep it simple.

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