We know..recordkeeping is SOOO outdated. Manilla folders are all neatly labeled, storing their potential that eventually turns to dread as January comes to end. Business owners have started the year strong with the mindset of precisely organizing receipts for any expense related to their business. But, you get busy, I mean – you are running a freakin’ business?!?! ESPECIALLY if you are a solopreneur!
Kickstart Accounting Inc, just wanted to remind you that it is never too late to pick (back) up your record keeping. Even if it is October, it is important to strengthen your business and help streamline your business practices.
Although we do not handle tax filing, we know a few things and want to help you out as the year comes to a close.
If you are reporting 1099 income, you are accustomed to deducting job-related expenses. This is so important because it allows you to reduce your taxable income by accounting for the business expenses you have accrued throughout the year.
The IRS will not accept any receipt you found in the dryer (sadly 😩). For a receipt to be accepted it must include the amount spent, location, date, and type of expense (or how it relates to your business). The receipt also needs to include any other important details written directly on the receipt – customarily the back. We recommend making a copy of each receipt and storing each group in a separate place for backup purposes.
If all this sounds like a space nightmare for your small business – consider investing in a digital solution. There are plenty of apps that allow you to electronically scan and store your receipts, some are even free of cost.
This is also a good option if you are looking to store your business expenses for the recommended three years – in case of an audit.
Looking for more records the IRS recommends small business' keep? Check out this article!
Reading this article and thinking “Taxes?? SO SOON?”, don’t worry! Kickstart Accounting is happy to help you get your business financials in shape before the end of the year. While we do not offer in-house tax preparation, we know a few people who do and would be happy to assist you!