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Tax time – for small business owners and freelancers it’s not just a once a year thing, it’s an all the time thing! However, that doesn’t exactly lower the stress level as you struggle to finish everything on time so you don’t get hit with any fines out of the blue. Here are 10 things you should do right now before adding your first numbers.
1. Organize Finances
Most of the time what small business owners consider “tax time problems” are really “organization problems.” So get organized now and the rest will be simple! Sign up for Outright and import all of your business financial accounts – bank accounts, credit cards, PayPal, Etsy. Etc. - to instantly get an idea how much money you have and much money you’re spending. Plus, Outright Plus helps you calculate sales tax and quarterly estimated taxes, and fill out your Schedule C.
2. Automate Bills
The last thing you want taking up space in your head when agonizing over taxes is worrying about your monthly bills. Automate as many of them as possible so you don’t have to worry about them when your sales take off and you’re busy with so many other things.
3. Set Calendars
Worried about missing an important date? Think you might slip up and miss a few things because you just don’t have time? Set up all your calendars as soon as possible so you never miss an important deadline, including all sales tax filing dates and your quarterly estimated tax payments.
4. Break Times
It’s not a good idea to just power through all your tax forms with no break time scheduled. You have to tear yourself away to give your brain some rest. Have some fun, low-stress activities planned during your break so when you come back you’re refreshed and ready to finish.
5. Get Your Deductions Ready
You want to save as much money as you possibly can with your taxes. Therefore you need to maximize your deductions. Hopefully you’ve been saving all your receipts – travel expenses, gas expenses, and every other receipt you can think of so you’re not paying out the nose to the IRS.
6. Digitize Paperwork
Speaking of receipts, stop keeping them in a box in your closet and digitize them for easy storage. Scan them in or send them to a company like Shoeboxed so everything is on your computer rather than lying around your office. This will make everything much easier to search when it’s time to file.
7. Get Your Business Prepared
While you’re preoccupied dealing with your crazy tax time, your business can suffer. Make sure sales don’t get hurt by taking measures to automate as much as your business as possible. If you don’t have time to go to the post office, set up a time they or another service can pick your packages up.
8. Look at Last Year’s Paperwork
Whether you’re doing April taxes, QETs, or even sales tax, look at last year’s (or the last time you filed) paperwork. This can give you a better idea of what to do and might even remind you of some deductions and expenses to take into account.
9. Set Up a Work Schedule
You organize your work day down to a T – so why not do the same with your taxes? Instead of sitting down not knowing what to do, have a set amount of tasks you want to accomplish each time you work on it. This way you don’t get overwhelmed.
10. Accountant’s Phone Number
Have some big questions? We all do. Don’t assume you can find the right answer or you can just guess and figure it out. If you really need help, don’t be afraid to call an accountant. You may even end up hiring them to do the dirty work for you!
How do you get organized at tax time?