Tax season has arrived, it’s time to get your finances organized and ready for your accountant. In this episode, we’re sharing a checklist for getting your tax documents ready and tips on how to do that.
Finish any open accounting in your business this year. Record all your activity, reconcile all accounts and be sure all your banking, credit cards, and loans are ready to go.
Determine your expenses. What financial activity are you using for deductions? Record and document all expenses such as client meals or business mileage in your personal vehicle.
Employee and Contractor documents. You have until January 31st to remit 1099s to independent contractors. It’s important to double-check for W9 documents and get those documents in order as soon as possible. Additionally, you are sure to finish up the payroll return and distribute W-2s in a timely manner.
Fixed Assets VS. Expenses. Vehicles, furniture, fixtures, and technology can be seen as Fixed Asset which you claim and depreciate each year. Determine the cost of these assets and determine if they can be written off as an expense or if they need to be a fixed asset.
What about retirement? Hopefully, you’ve been talking with your accountant throughout the year and you have a plan in place and know when things are due. If not, determine what’s the best plan for you and how you can pay into that.
How long should you keep receipts? The short and conservative answer is 7 years. It does not have to be paper copies, all documents can be scanned and kept digital. This time period will take you well past any requirements and keep you safe in the event of an audit.
As you're going through this tax season be sure to not your setup and system of documents, make sure it's efficient and well organized. Whether you prefer paper copies or digital files, use this year to perfect and maintain your system to continuously provide quick and correct documents to your accountant year after year.
What’s Inside:
Mentioned In This Episode:
Modern CPA Online
Tax season has arrived, it’s time to get your finances organized and ready for your accountant. In this episode, we’re sharing a checklist for getting your tax documents ready and tips on how to do that.
Finish any open accounting in your business this year. Record all your activity, reconcile all accounts and be sure all your banking, credit cards, and loans are ready to go.
Determine your expenses. What financial activity are you using for deductions? Record and document all expenses such as client meals or business mileage in your personal vehicle.
Employee and Contractor documents. You have until January 31st to remit 1099s to independent contractors. It’s important to double-check for W9 documents and get those documents in order as soon as possible. Additionally, you are sure to finish up the payroll return and distribute W-2s in a timely manner.
Fixed Assets VS. Expenses. Vehicles, furniture, fixtures, and technology can be seen as Fixed Asset which you claim and depreciate each year. Determine the cost of these assets and determine if they can be written off as an expense or if they need to be a fixed asset.
What about retirement? Hopefully, you’ve been talking with your accountant throughout the year and you have a plan in place and know when things are due. If not, determine what’s the best plan for you and how you can pay into that.
How long should you keep receipts? The short and conservative answer is 7 years. It does not have to be paper copies, all documents can be scanned and kept digital. This time period will take you well past any requirements and keep you safe in the event of an audit.
As you're going through this tax season be sure to not your setup and system of documents, make sure it's efficient and well organized. Whether you prefer paper copies or digital files, use this year to perfect and maintain your system to continuously provide quick and correct documents to your accountant year after year.
What’s Inside:
Mentioned In This Episode:
Modern CPA Online