Tax season is that magical time of year where you question why you ever started a business in the first place. You also question whether the coffee machine you bought in January actually counts as a deduction. Spoiler alert, it may! If you’re a Mompreneur juggling play dates and profit margins, tax season can feel overwhelming. But it doesn’t have to be. The right tools and a little preparation means that you can face those numbers like the boss that you are.
And hey, if you ever feel like handing the whole thing off to the pros, the team at Fully Accountable accounting firm knows how to keep small businesses like yours intact. There are many ways that you can get your tax game strong without losing your mind or your receipt folder, so let’s take a look at five ways to do that below.
5 Ways to Get Tax Season Right for Your Business
1. Start Now
Procrastination is tempting, especially when your To-Do list is a mile long and your toddler just discovered how to open the snack cupboard while you’re trying to work. But getting a jump on your tax prep gives you way more time to gather documents, find deductions, and fix any surprises before the deadline drama hits.
Setting aside a couple of hours one weekend, pouring yourself a fancy coffee and treating it like a self-care ritual can make you Pavlov yourself into believing that tax season is a good thing.
2. Get Some Help
You do not have to do this by yourself. Outsourcing your tax and your accounting is one way to make sure that you don’t make any mistakes. The experts out there know what they’re doing, and they can help you to drag your business into the tax season with no penalties.
3. Keep Your Personal and Business Financials Separate
It is crucial to keep your personal and business financials separate. Mixing your business expenses with your personal expenses is like allowing your kids to draw with Sharpies. It never ends well. Having a dedicated business bank account and credit card keeps everything clean, simple and ready for tax season. It also makes tracking your deductible expenses way easier. You don’t have to scroll through dozens of receipts trying to remember if those bins were for organizing inventory or storing Paw Patrol toys.
4. Track Everything
It’s so important to know your deductions, and if you haven’t already, it’s time to pick a bookkeeping method that fits your life. Take a few minutes every week to log receipts, mileage, and payments into a spreadsheet. There are even apps that allow you to scan receipts with your phone, which is way easier than digging through a crumpled pile in your diaper bag come April.
5. Know What Your Deductions Are
Understanding what you can and cannot claim for in your business is how you’re going to make sure that your business is aligned properly for tax season. As we said, you don’t have to do it all yourself. If tax prep is something that makes your eyes glaze over, or you’d rather spend your time growing your business or getting some sleep, make sure that you’re giving it to somebody who knows what they’re doing.
Final Thoughts
Tax season should be a breeze when you follow the above-mentioned guidelines. It’s always better to be prepared and know the right steps in order to file your business taxes the correct way. We hope you will incorporate these tips when you tackle your next tax return.