This past year was the first year that I was fortunate enough to work from my home. Working from my home has been a wonderful change for both personal and professional reasons. The only thing that caused a slight issue was the tax filing changes that I had to endure. The office in my home was now considered a tax deduction. I had to get some help learning how to deduct the things that are allowed on my federal taxes. If you are new to working from home and have a home office, this blog can help you learn what you need to know before tax time rolls around.
As a new small business owner, your life is probably pretty hectic. However, one area that you will want to ensure that you keep on top of is your books. You can choose to do these yourself or hire a professional certified public accountant to do them for you. If you decide to go the route of doing them yourself, it doesn't have to be as hard as you may think. This is particularly true if you follow a few small business accounting tips that will help set you and your business up for financial success. Keep reading to learn more.
Separate Your Personal and Business Finances
One of the most important things you should do is to ensure that your personal finances are kept separate from your business finances. At the end of the month or year, you do not want to have to figure out which transactions are personal and which ones are business-related. Therefore, by having two accounts, you can keep things more organized and hassle-free.
Keep Your Records Tidy
While your home may be a little cluttered and messy, you want to ensure that your business and financial records are organized and tidy. This will ensure that you do not have to spend hours or days searching for a particular document that you need or organizing your records when the time comes.
Keep Your Receipts
Any business-related purchase that you make is important. Therefore, you should keep the receipts for these purchases so that you can later claim these expenses on your tax return. Depending on the type of business you run, you may need to keep different receipts. For instance, if you are running your small business out of your home, you will need to keep receipts from your residential bills since you can claim a portion of them on your return. Otherwise, you can keep receipts for anything that you use to run your business, including stamps, stationery, and other office supplies.
Know and Stick to Tax Date Deadlines
Tax deadlines can easily be forgotten if you are not familiar with the dates. Therefore, make sure that you familiarize yourself with all tax deadlines associated with your business. Mark them on the calendar and set reminders on your phone if you need to. These deadlines can be particularly stressful, especially if you forgot about them, leading to mistakes on your end.
The aforementioned tips will help lead to a smooth bookkeeping process on your end. However, if you prefer not to keep your own books, reach out to a certified public accountant like John M Vlasac & Company in your area for assistance.
Share15 January 2021
