Taxation can be quite of a challenge for those who are just starting out their business. From recording expenses to filing important documents, there are various steps involved in planning and preparing for the tax season. Experts at the Sorenson & Company share smart tips to help you get through this process without a hitch.
Invest in Reliable Accounting Software
If you don’t use accounting software, you’re setting your business for failure come tax time. Having this piece of technology makes the recording of income and expenses easier and more accurate.
Use Annual Business Credit Card Reports
It’s important to set up a separate checking account for your business, one that you will never use for personal expenses. This makes it faster to classify items that are deductible and reportable for tax purposes. If you’re using your business account for your private transactions, you’ll have to manually go through your bank statements and pick items that are related to your business.
With today’s technology, it’s more convenient to create electronic copies of financial documents than to store them away at a physical filing cabinet. It’s time to retire those dusty filing cabinets and migrate to an electronic system. With this, you can have access to any receipt within just a few clicks away. Documentation, after all, is crucial to avoid legal drama.
Download All Bank or Credit Card Statements
If you’ve been doing online banking, this one is probably a no-brainer. But for those who are still receiving paper copies of their card and bank statements, you better cut the cord soon. Be wary because identity thieves can easily steal your information by opening up your mail.
Many entrepreneurs still struggle with keeping track of their bookkeeping throughout the year. The tax season can be a breeze if you set up an organized system to record and store all of your receipts.