If there’s something we know well, it’s bookkeeping. In order to run your business well, you need a good account of how much you’re making vs. how you’re spending. Each expense should be well categorized and given a tax code. You help us with the category, we help you with the code.
We’ve put a list of good bookkeeping habits together for show and tell. Apply these to your business and you’ll be good to go.
- Illustrative Track Expenses
- A good credit card could be the answer to your problems. Some credit cards automatically track charges. If you use this card solely for business expenses, you can get a monthly and accurate record of what you’re spending on.
- Track Business Lunches and Travel Expenses
- An important part of most businesses is food and entertainment. This type of expense is 50% tax deductible. This means only half of what you spend can be used as a business expense. So next time you take a client out for a coffee, or your employee out for lunch, track it. Trust us, it adds up.
- Track your Deposit
- A deposit could be one of many things. You can deposit income for your business, loans from lenders, or capital from partners. The type of deposit affects where it ends up on your financial reports. Income shows up on your Profit & Loss Statement while Loans and Investments end up on your Balance Sheet. Make sure you track the different types each month.
- Set aside money for Taxes and Pay Estimated Tax Payments
- Don’t forget you will owe taxes on the money you make. Of course you only owe money on the profits of your business. But this could creep up on the best of us. So every quarter you should pay about 20-25% of your total profit to the IRS.
- Find an Accountant
- Whether you choose us or our competition, it’s always good idea to hire an accounting firm. As an entrepreneur, time is your most scarce and precious resource. Your time is always in high demand and short supply. We recommend you determine what your time is worth for the time it takes you to do your own bookkeeping and payroll each month. Now compare that time and value to our monthly fee of $200. If that sounds like a good solution, click here for more details.