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Now that most of us are working from home, there are things as a small business owner that you can do to keep your business on track during this uncertain time. As you save on your travel time to the office, why not take the opportunity to get your bookkeeping and finances up-to-date.
The IRS announced last week the postponement of the April 15 payment deadline. While the payment deadline has been extended to July 15, for now, the tax return filing deadline is still April 15. With a few weeks left before filing, you still have time to organize your books so filing will be a lot smoother and less time-consuming!
Here are a few tips to help you get up-to-date on your books while your home:
#1 – Sort and Organize Your Financial Records
The first step to catching up on your bookkeeping is to get organized! You’ll want to start compiling and organizing invoices you sent to customers, receipts, bank, and credit card statements where you made purchases that are business expenses. Now is also a good time to review any outstanding invoices and collect on that debt.
#2 – Separate Personal and Business Expenses
We advise our clients to keep their personal and business expenses separate. Comingling business and personal expenses may result in you being held personally liable for your business’s debt and financial standing. We recommend going through every transaction to determine if the expense was personal or professional.
#3 – Review Your Expenses, and Look for Credits and Deductions
Once you have all of your records organized and in-hand, you should take the time to review these expenses and determine your deductions and credits. We suggest hiring a tax professional to review your records and advise you on which business credits and deductions are right for you.
#4 – Reconcile Bookkeeping
Once you’ve organized and separated your expenses, you can log in to your accounting software and reconcile these expenses with your bank statements. This is one of the most crucial steps in preparing for tax filing, so be sure to take care when matching records.
#5 – Collect Tax Forms
Your taxes can be more complex when you're self-employed or a small business owner. Managing and collecting the forms you need to file for yearly income taxes ahead of time can save you a lot of headaches down the road. When tax season rolls around, you will have all the right forms ready to go. Access IRS tax forms and determine which forms you’ll need for filing here.
#6 – Prepare for Next Year and Consider Hiring a Bookkeeper!
Catching up on your bookkeeping now is the best way to save yourself time during tax season. It’s never too late to get started yourself or hire a bookkeeper to handle the books for you. Feel free to reach out to us at email@example.com and let us handle your books or call (856) 229-0941 if you have any questions.