Bookkeeping
As the year winds down, it’s the perfect time to tidy up your books and get ahead for tax season. Let’s dive into a few simple steps you can take to close out the year on the right foot and set yourself up for success in 2025.
1. Reconcile Your Accounts
First things first, compare your bank and credit card statements with your bookkeeping records. This helps ensure all transactions are accurate and accounted for. If you spot any discrepancies, addressing them now will save you from future headaches.
2. Get Your Receipts in Order
Receipts can pile up quickly, can’t they? Gather all your business expense receipts, whether they’re physical or digital. Use a scanner or a handy app to digitize them, and then store everything in a cloud-based folder. This simple step will keep your records organized and easily accessible.
3. Review Outstanding Invoices
Take a moment to check for any unpaid invoices. A friendly reminder to clients can do wonders for improving your year-end cash flow. Plus, you’ll feel great knowing you’ve collected what’s owed to you.
4. Run Key Financial Reports
It’s time to generate your Profit & Loss Statement, Balance Sheet, and Cash Flow Statement. These reports give you a clear snapshot of your business’s financial health and are invaluable for tax preparation.
5. Gather Tax Documents
Start gathering the essentials, like W-2s for employees, 1099s for contractors, and records of deductible expenses such as mileage, utilities, and office supplies. Having everything in one place makes tax season a lot less stressful.
6. Plan Ahead for 2025
With the year’s data in hand, you can set new financial goals, create a budget, and outline your growth plans for 2025. A little forward planning now can lead to big rewards later.
Final Thoughts
By tackling these tasks before the clock strikes midnight on December 31, you’ll make tax season a breeze and start the new year feeling organized and confident.
Need help? Don’t hesitate to reach out. I’m here to ensure your books are in top shape. Cheers to a successful end of the year and an even brighter 2025!
Bookkeeping
One of the most common misconceptions I hear from entrepreneurs is: “I’m a one-person business. Do I really need bookkeeping?”
The belief that bookkeeping is only for large companies with complex financials is widespread, but it’s not true. No matter the size of your business, bookkeeping is crucial to maintaining healthy financials.
𝗪𝗵𝘆 𝗦𝗺𝗮𝗹𝗹 𝗕𝘂𝘀𝗶𝗻𝗲𝘀𝘀𝗲𝘀 𝗡𝗲𝗲𝗱 𝗕𝗼𝗼𝗸𝗸𝗲𝗲𝗽𝗶𝗻𝗴
𝗧𝗮𝘅 𝗧𝗶𝗺𝗲 𝗶𝘀 𝗘𝗮𝘀𝗶𝗲𝗿
With organized books, tax filing becomes much simpler. Accurate records help you avoid overpaying and make sure you don’t miss deductions. The IRS expects every business—no matter the size—to maintain proper financials.
𝗕𝗲𝘁𝘁𝗲𝗿 𝗙𝘂𝘁𝘂𝗿𝗲 𝗣𝗹𝗮𝗻𝗻𝗶𝗻𝗴
You need to know where your money is going. Bookkeeping gives you insights into cash flow, helping you budget for future expenses and identify opportunities to grow your business.
𝗖𝗼𝗺𝗽𝗹𝗶𝗮𝗻𝗰𝗲 𝘄𝗶𝘁𝗵 𝗥𝗲𝗴𝘂𝗹𝗮𝘁𝗶𝗼𝗻𝘀
If you’re paying yourself or contractors, bookkeeping ensures you stay compliant with payroll and tax laws. This can help avoid penalties and fines.
𝗖𝗹𝗮𝗿𝗶𝘁𝘆 𝗼𝗻 𝗣𝗿𝗼𝗳𝗶𝘁𝗮𝗯𝗶𝗹𝗶𝘁𝘆
Proper bookkeeping helps you understand how profitable your business is, giving you the power to pivot when things aren’t going as expected.
𝗖𝗼𝘀𝘁 𝗖𝗼𝗻𝘁𝗿𝗼𝗹
Detailed records help you identify unnecessary expenses, so you can trim costs and increase profits.
𝗥𝗲𝗮𝗹-𝗟𝗶𝗳𝗲 𝗘𝘅𝗮𝗺𝗽𝗹𝗲
If you don’t know me that well, I can tell you that I have worked with hundreds of small businesses, including many solo entrepreneurs. One freelance client used a basic spreadsheet to track finances but missed thousands of dollars in deductions during tax time. After setting up proper bookkeeping, tax season became easier, and he doubled his profit margins within a year by identifying areas to cut costs.
𝗪𝗵𝘆 𝗬𝗼𝘂 𝗦𝗵𝗼𝘂𝗹𝗱 𝗧𝗿𝘂𝘀𝘁 𝗮𝗻 𝗘𝘅𝗽𝗲𝗿𝘁
As someone with over a decade of experience, certifications in QuickBooks and Gusto, and a background in working with small businesses, I’ve seen firsthand how vital bookkeeping is for businesses of all sizes. Whether you’re a solo entrepreneur or managing a team, bookkeeping is your financial foundation.
Get ahead of tax season and start reaping the benefits of good bookkeeping now! Let me know if you need help getting started.
Bookkeeping
If you’re running a small business, managing finances can be a lot like managing your personal finances, but with a few important differences. Understanding these differences is important for success in both areas. Let’s take a closer look, shall we?
To manage your personal finances effectively, you need to budget, save, invest, and plan for your future. These steps are essential for individuals and families.
- Setting personal financial goals
- Creating and sticking to a budget
- Building an emergency fund
- Planning for retirement
- Managing personal debt
On the flip side, business finance focuses on strategies that help your business grow and sustain. This includes:
- Keeping accurate and detailed financial records
- Understanding cash flow management
- Separating personal and business finances
- Planning and forecasting financial performance
- Managing business investments and expenses wisely
Recognizing the differences between managing personal and business finances is crucial for achieving financial success, whether as an entrepreneur or an individual seeking to improve their financial literacy.
Our team is here to support you in achieving your personal financial goals or business growth with professional bookkeeping services that provide clarity, efficiency, and peace of mind.
Bookkeeping
As a small business owner, accounting is critical to running your business. It’s essential to keep your financial records accurate and up-to-date to make informed decisions, save money on taxes, and ensure your business’s long-term success. However, accounting mistakes are common, and they can be costly, both financially and legally. In this blog post, we’ll discuss some of the most dangerous accounting mistakes you should avoid keeping your small business on track.
Mixing Personal and Business Expenses
One of the most common accounting mistakes small business owners make is mixing personal and business expenses. This practice can create a mess in your bookkeeping, making it difficult to accurately track your business’s financial performance. It can also create tax implications, leading to an audit or penalties.
To avoid this mistake, always separate your business and personal finances. Have separate bank accounts, credit cards, and accounting software for your business and personal expenses. This way, you can track your business transactions efficiently, and when tax time comes, you won’t have to spend hours sorting out which expenses are business-related.
Failing to Keep Accurate Records
Another dangerous accounting mistake is failing to keep accurate financial records. With proper record-keeping, you will know how much money is coming in and going out of your business, making it easier to make informed financial decisions.
To avoid this mistake, keep track of all your business transactions. Use accounting software to record sales, expenses, and other financial transactions. Make sure to reconcile your bank and credit card statements regularly to ensure that all transactions are accounted for and that there are no discrepancies. A QuickBooks ProAdvisor like we have here at Amanda Saye Bookkeeping Services will check for these discrepancies and keep the accounts separate.
Ignoring Tax Obligations
Taxes are critical to running a small business; ignoring your tax obligations can lead to severe consequences. Failure to pay taxes or file tax returns on time can lead to fines, penalties, or legal action.
To avoid this mistake, keep track of all your tax obligations, including sales, payroll, and income taxes. Please file all necessary tax returns on time and pay any taxes owed as soon as possible.
Misclassifying Workers
Another common accounting mistake is misclassifying workers as independent contractors instead of employees. This mistake can lead to tax implications, including fines, penalties, and legal action.
How to understand the difference between employees and independent contractors to avoid this mistake? Employees are typically under your control, and you’re responsible for paying their payroll taxes, providing benefits, and following labor laws. On the other hand, independent contractors work for themselves and are responsible for their taxes and benefits.
Not Reconciling Accounts
Not reconciling your accounts is another dangerous accounting mistake. Reconciliation involves matching your accounting records with your bank and credit card statements to ensure that all transactions are accounted for and accurate.
To avoid this mistake, reconcile your bank and credit card statements regularly. This way, you can catch any errors or discrepancies early and take corrective action before they become a more significant issue.
In conclusion, accounting mistakes can be costly and have severe consequences for your small business. However, avoiding these dangerous accounting mistakes allows you to keep your finances in order, make informed financial decisions, and ensure your business’s long-term success. If you need more clarification about your accounting practices, contact us HERE to help you get on track.
Bookkeeping
There are several things you should consider when looking for bookkeeping services:
- Expertise: Look for a bookkeeper who is knowledgeable about your industry and has experience working with businesses similar to yours.
- Accuracy: The bookkeeper you choose should be detail-oriented and able to accurately record financial transactions.
- Timeliness: Look for a bookkeeper who can work efficiently and consistently meet deadlines.
- Flexibility: Consider a bookkeeper who can adapt to your changing needs and is able to work with you on a schedule that works for your business.
- Communication: A good bookkeeper should be able to clearly communicate financial information to you in a way that you can understand.
- Cost: Determine your budget for bookkeeping services and look for a bookkeeper who can work within that budget.
- Professionalism: Choose a bookkeeper who is reliable, organized, and professional in their work.
- Confidentiality: It’s important to find a bookkeeper who will maintain the confidentiality of your financial information.
- Technology: Look for a bookkeeper who is proficient in using bookkeeping software and can efficiently manage your financial records electronically.
- Certification: Consider hiring a bookkeeper with a professional certification, such as a Certified Public Bookkeeper (CPB) or certifications in QuickBooks. These certifications demonstrate a high level of expertise and commitment to the profession.
Recent Comments