If you own a small business without a dedicated bookkeeper or accountant, there’s a possibility you aren’t covering the basics. But it’s still early in the year, and there is time to put in place some best practices for an easier tax season.
Here’s what you SHOULD NOT do:
Let receipts pile up. Make time to scan your receipts and input your expenses every month. Just throwing your receipts into a pile or box and accumulating will lead to scrambling when tax time comes, taking hours to organize. Stay organized to avoid added stress.
Manage your business finances according to what money is in the bank. If your checking account has surplus money after paying yourself, overhead, credit cards, loans, and estimated taxes, spend wisely. However, keeping reserve funds will help to pay unexpected costs, fines, or penalties you may incur. You can calculate what you should pay in estimated taxes each quarter by reviewing the worksheet in Form 1040-ES, Estimated Tax for Individuals, And, at year-end, turn over your books and documentation to a tax preparer. Leave the daunting task of preparing your taxes to an expert.
Buy, buy, buy. Not the best plan. Rather than buying and spending your business’s funds, keep as much money as possible, which, in turn, makes your company more appealing to investors and banks when applying for a loan.
Know your numbers: Some business owners tend to neglect their bookkeeping. As always, American Finasco cannot impress upon small business owners enough that if you don’t know to understand your business finances, find someone who does and whom you trust.
Feeling overwhelmed? By leveraging American Finasco, your debt can be managed, reduced, or consolidated while you stay focused on your business. Visit Contact Us and complete our Online Form for a free consultation or call (800) 299-2909. We look forward to speaking with you.
Watch for our next blog with suggestions for staying on top of your taxes this year.