My method is a simple one. I open a Word Document and write in what I want to show on the label. For example:
My Happy Place
Virginia Beach, Virginia
Quilted by Marae Harris
I iron a 8-1/2" x 11" piece of freezer paper to a piece of fabric that is cut just a little smaller. Usually the paper curls a little so I press it under something heavy while it cools. I try to do a few labels at a time on the same page. The fabric side faces down in the paper drawer and rolls up to be printed on. Often the top edge catches when it starts going through the printer and the top of the page gets smudged with ink, so I leave a large margin at the top just in case. This isn't a fool proof method, but it works well enough. The more you do it, the more you know what to expect.
After your page is printed on the fabric you can peel it off the freezer paper and press it with an iron. The heat seals the ink so it doesn't wash out. Now trim down each label, leaving about an inch around each side of the lettering. Add little borders to make it cute, if you wish. Next I sew it right side down to a piece of light colored fabric on all four sides. Carefully slit open the back and turn it in side out. Pull out the corners, press it and it is ready to stitch on to the back of your quilt. You will thank yourself for doing this in the coming years!
I also like to give notice as to who designed the quilt. Sometimes it's me, but not always. Also, who quilted it, what batting, etc. Sometimes there is a story behind a quilt that you may add.
Another thing I have done when I make little gifts for friends is to simply make a bunch of little labels with my name and the year, fold all the raw edges in and tuck it into the binding so you have a little tab label.
I know people document their quilts in different ways. If we post them on our blog we can do a search with the right key words. Today I was able to find a post by Karen Mowery about a quilt that she made that was recently won at an Ebay auction. My friend Paula the Quilter was the high bidder and when she received the quilt there was no label. Luckily we were able to find Karen's notes about the quilt on her blog! It was a great find because it not only gave the date she made it, but also who quilted it and the fabric line and her inspiration in creating it! Now Paula can make a really interesting label!
By the way, a few of you have asked about Karen's cats, especially Rembrandt, and whether they found homes. Yes! I am happy to report that Karen's son Tim found homes for both her cats!