April 16, 2018
Tomorrow is Tax Day in the United States, the deadline for filing tax returns for the 2017 calendar year. After you click "Submit" or drop the finished documents in the mail, don’t forget to protect all of that hard work. If you are like most people, you use tax software like TurboTax to file your taxes and financial software like QuickBooks to organize your finances in preparation. You’ve invested hundreds of hours in keeping those up-to-date, so let’s walk through how to protect those digital assets locally (as part of your paperless finances).
Either you prepared your taxes yourself or used a tax preparer, it’s important to keep a copy of the return and accompanying information for future reference. Tax preparers are steadily migrating to paperless documents, with online services like SmartVault to provide secure online file storage. Be sure to download the files locally to have a copy that you control and can protect in multiple locations as part of your overall backup strategy.
Using online tax preparation services like TurboTax makes it easy to file and download the results. Don’t wait to download the associated documents: both an exported PDF and the TurboTax format of the data. You might need them when the service is unavailable. TurboTax Online offers access to returns until mid-October of that year, unless you also purchase a paid subscription called PLUS which gives you access to it for an additional year. TurboTax Online is just one service yet it has enough editions to require a detailed Knowledgebase article for when access to a previous year’s returns expire: When does access to my prior-year TurboTax Online returns expire?. Moreover, Intuit experimented with a feature titled Backup to Cloud, which it then discontinued the next year. Like we discussed in How to protect your paperless finances, you cannot rely on third parties to keep your documents immediately available to you.
With TurboTax on your computer, you can submit your taxes without using an online service. You can export your returns both as a PDF and a TurboTax-specific file format. The TurboTax file will save you time next year when starting your next year’s tax returns.
In every case, keeping a local copy of your returns as a PDF and as an application-specific file will help you maintain access to it in the future.
To prepare your taxes, you’ll need documentation as to your financial status. Businesses and personal lives are complicated enough that most people use software to manage their financial information, and you need to have a backup copy of your data in case of corruption or accidents. QuickBooks, Xero, Mint, and Quicken are the most popular services, so we’ll walk through each.
QuickBooks comes in many different editions including Desktop, Enterprise, and Online.
QuickBooks Online: You can export your data to a QuickBooks Desktop format using their guide.
QuickBooks Enterprise: Intuit Data Protect is a paid service provided by Intuit for protecting your QuickBooks files. You can also create periodic backups (if in single-user mode). Finally, you can rely on Retrospect to back up the raw data underlying QuickBooks Enterprise. If you see an error in Retrospect during backup ("can’t read, error -1020 (sharing violation)"), there might be another software module called Intuit Sync Manager running, and you’ll need to disable it.
Xero is a popular online accounting service. It has an export feature for downloading general ledger data, Detailed General Ledger, Detailed Account Transactions, Aged Payable Summary, Balance Sheet, Profit and Loss, as well as VAT Returns. In addition, it supports exporting to Intuit Lacerte Tax and CCH ProSystem fx Engagement.
Mint is an online tool for organizing your finances. It supports exporting transaction data as CSV.
Quicken is the venerable finance tool for Windows and Mac. It supports exporting Quicken accounts as backup files with step-by-step instructions.
Hopefully, you’ve already submitted your taxes for the year, as today is the deadline. Take a minute to think about all the work you put into tax preparation and financial bookkeeping. It’s a lot of hours. Be sure to protect all of that work by protecting the digital data, in whatever format you use, with Retrospect. It’ll give you peace of mind.
Brian Dunagan is Vice President of Engineering at Retrospect and has been with Retrospect for more than a decade.