True it is only September, but the new year is right around the corner, and now is the time to make sure you are ready to file your taxes. Isn’t that so exciting? The more organized and complete you are with your bookkeeping throughout the year, the easier this will be. But you can still take time over the next 3 months, making January-April much easier for you in 2014. Here’s a list of tasks to make sure you’re organized and are not missing anything.
1. Reconcile all bank statements. This process helps to ensure that you have properly recorded your payments and expenses. It also helps you catch any possible bank errors or extra fees that you should not have had to pay.
2. Make sure you have invoiced your customers, which keeps your invoicing system organized. Also review any unpaid balances and make sure that your outstanding balances match your records.
3. Record all transactions that are not paid for with your business account. Sometimes we make charges or pay for things in cash without recording them. By reconciling credit card statements, it is easier to keep track of business expenses versus personal expenses. If you don’t record all of your expenses, your reports will show a higher profit and you will pay more in taxes.
4. Track your mileage, record trips, and keep gas receipts if possible. Your commute to and from your place of work is not allowed to be used as an expense, but any trip taken for business can add up over the year.
5. Review your categorized expenses. Office supplies and entertainment costs should be in the correct category so that you can compare costs from last month and last year. This also ensures that only deductible expenses are recorded, eliminating possibilities for record errors.
6. Make sure contact information is accurate for employees and contractors so that W2’s are properly prepared. Collect your contractors’ W9 forms because in January, you may be required to file a 1099 form for them, and you will need accurate taxpayer information.
7. Prepare a budget for next year. Take your Profit and Loss statement for this year and enter this information into next year’s budget. Then take a look at the sales and expenses for each month and make any changes if needed. Continue to review your income and expenses throughout the year.
What are you doing to make tax season a little easier for your business? If you need help organizing your records or handling your bookkeeping, that is what we do best!