If you are one of the many small enterprises with a sole Bookkeeper throughout the year, this tax season will, unfortunately, be a stressful time as you frantically scramble to take together all your receipts and business bills, trying to bank account for every sole thing you did in 2014.
To assist you through this period here is a useful checklist of the very best four things you must do before you convert your books over to your tax preparer:
Apply for an extension.
Give yourself plenty of time to compile your financial documents in order before you put a “Hail Mary” go to get them to your taxes Bookkeeper. You have no idea how long this process will take, so it is best to give yourself enough time.
Don’t wait until April 14 to ask for an expansion for filing a tax go back. Keep in mind that you will also need to calculate potential taxes due and send that along with your extension request. If you feel you have previously paid the taxes unpaid, you do not need to worry about this.
If an income has increased over what you projected during the yr or your bills are less than anticipated, you will need to pay the total amount owed or be at the mercy of penalties and interest when you finally do pay your taxes.
Accumulate all financial documents.
Compile documentation for all your purchases, business bills, income and information of transactions, tugging all of your receipts, bank statementscanceled checks and paid bills.
If you area small business owner who tends to put some expenditures (like for an office at home) on personal bank cards, that documentation also needs to be gathered to ensure all business costs are captured.
Type and categorize financial documents.
After you have collated your financial assertions, kind and categorize each business price into different buckets, such as vehicle expenses, home-office expenses, utilities, medical bills, office materials and charitable efforts.
This way the tax Bookkeeper can easily gain access to the right numbers, give food to them into a spreadsheet and run computations to determine deductions you could be eligible for.
Make sure all income is noted.
Tracking income is the region where small enterprises can get into trouble. You need to be able to say to your taxes preparer, “this is one-way much money I made this year,” because if the inner Earnings Service audits you, the number must be 100 percent accurate.
The IRS does not worry if you neglect to report all your business expenditures but will go after you for failing woefully to report your earnings accurately.
After Taxes, Day is finally in the rearview reflection, and you have registered your return, sit down and make an effort to identify a much better way of keeping your financial records — not only during taxes season but throughout the year, so you are not in this same situation again next year.
Unless you have time for you to execute a little bookkeeping every day, when will you find a chance to record a month’s or a year’s worth of records? Differing people have different systems. What counts the most is that you have something and put it to use daily — whether you work with a specialist bookkeeper or do-it-yourself.
For more info: http://www.bookkeeperco.com.au