Tax season is almost coming to a close and final preparations are being completed as this year comes to an end. With the 2019 year ending, many businesses are considering ways to improve upon the upcoming tax season ahead. With tax laws changing constantly it is a good idea to start the next year off on the best footing. Here we have compiled a few tips to help you and your business better prepare for tax season next year.
Organize receipts (use accounting software)
One of the most missed opportunities when it comes to reducing taxes owed is keeping track of receipts. Those dinners where you takes business, that receipt for an oil change on a company car, and that repair on a business computer adds up. If you do not organize and keep track throughout the year, you could be missing out on major deductions. By implementing software such as QuickBooks you could easily manage those receipts and organize them for the year. If you are relying on other systems, make sure to organize a simple way to keep track of expenses.
While the idea of not keeping receipts in a folder or in your wallet/handbag scares you, there are some pretty cool advantages of using a paperless system to track all your business handlings. With so many software solutions on the market, you can easily streamline, organize, and track business transactions in one electronic platform. Going paperless let’s you save by file name, dates, and can even keep you organized on things like payments received, bills paid, and deductions at filing time. Going paperless also saves trees- and we want to keep trees around.
Download credit card summaries and bank reports
Summaries are a great way to reconcile and ensure you accounted for spending and payments received. With downloading summaries, you can review where most of the spending has gone (categorical) and where you could see to save on some coasts and also find solutions to maximize the detections that may be attached. Knowing where money comes and goes before heading into tax season keeps you more in line with, well, your bottom line.
Ensure deductions are in order
It can’t be said enough: deductions, deductions, deductions. When it comes to small business making sure you’re deductions are in order is key. Heading into tax season, compare deductions from years prior to present all while reviewing any tax law changes. It’s best to see where trends are going for possible write offs along with where more deductions will come from in the future.
Keep information as you go
One of the biggest missteps of every small business is waiting until the end of the year to get tax documents organized. This has accounted for thousands of dollars left on the table at tax time. If you implement a online or electronic system for tracking expenses and revenue throughout the year, you increase the chances of reporting every penny. Keeping track throughout the year takes some discipline but it pays off huge in the end.
Consult with your tax advisor/accountant
Consulting with your tax advisor or accountant throughout the year is a wise move. Using an expert as your business grows to help you to ensure the most well laid out plan for the year. Use the trust and support of a seasoned professional to ask questions as the landscape of your business changes and as tax laws become more clear. It’s a good move to implement sooner than later.
Staying ahead of taxes is a key to a successful upcoming tax season. Preparing and setting some good foundational practices will ensure you have the best game plan going into this upcoming year.
With these tips you can be well on your way to a great year. However if you find that you need help using a trusted tax professional and accountant, we can help. With PKJ Consulting we offer a variety of services for your business. To learn more about what we offer and how your business can benefit, connect with us HERE and we can get started right away.