6 Bookkeeping Tips For Starting Your Own Business

Starting your own business can be a very rewarding experience. You will enjoy freedom and flexibility you never imagined. You will also work harder than you ever have before but it feels completely different when you are working for yourself. Here are some tips to help you get off on the right foot with your record keeping.

1. Keep Receipts For All Transactions From The First Day Onword. If you pay for everything with a check, debit card, or credit card this may not seem necessary. As a tax accountant I can assure you that it is. The IRS will disallow deductions if you do not have receipts to accompany your bank and credit card records.

2. Avoid Cash. I can tell you the easiest way to get into hot water with the IRS is to pay for things with cash and then not have a receipt. For many of us we are in a habit of using cash from the time we were kids. For your own business though, you need to avoid cash.

3. Deposit All Your Income. It is very tempting to withhold cash from your business receipts but I advise you do not. Instead be aggressive with your expenses. If you are in an industry where cash deals are common the IRS will look for evidence of cash deposits in your checking account. If they are absent you will have a lot of questions to answer.

4. Use QuickBooks. Inuit owns 80% of the small business accounting software market and for good reason. Their software is easy to learn and easy to use. Within a few hours after installing you can be producing your own professional financial statements. It is the software I use for my own accounting/tax business and also what I use to produce client Financial Statements and Payroll Reports.

5. Report Employee Earnings Timely. There are several services on the market that will be glad to do your Payroll Reports and process your employee checks. Shop around and get the best deal. This market has become more competitive which means there are some good deals out there for you. For example, if you are in a high risk industry you can get a reduced WCF rate with a company like ADP. With the amount you save in disability insurance for your employees your Payroll Tax preparation expense is essentially free.

6. Use A Business Credit Card. Using a business credit card has many benefits. You can usually find one with no annual fee, 0% introductory interest rate and even cash rewards. But for the purpose of this article one of the primary benefits is for your record keeping. At the end of the year you will receive a summary of all your expenses by category. Give this to your accountant along with your other records at tax time. This will make your accountant 's job easier which should lower his/her fees.

There are many other items to consider when starting your own business and I recommend you speak to an accountant as soon as possible. If you already have someone preparing your tax returns then you can start with them. Make sure they are familiar with hiring your spouse and children, medical reimbursement plans, business plans and entity structuring. Do not stay with an accountant who is not familiar with these because you cannot afford to.

Time To Stop Taxing Yourself

That is right folks; tax season is almost upon us. It is time to start organizing your paperwork again. How much time will you spend gathering your accounts receivables, accounts payables, receipts, mileage reports, W-2s and 1099s? And that is only the beginning. More of your time will be spent to meet with your bookkeeper, and then your accountant, each of them reminding you of what information you forgot to get to them, and each of them letting you know what they still need from you. Just how much time will you spend on a topic you really dont want to think about?

Imagine how much time you could save if you were paperless. Imagine if you could take care of everything by e-mail, without fussing with a bookkeeping program. Imagine if there was a virtual accounting office that would take the aggravation out of your bookkeeping and make preparing your tax return as easy as writing a check. What could be better than an accounting office that you never have to visit?

Better yet, how about a virtual accounting office where you access to your books anytime you want? How many times do you get a call from a customer wanting to know his balance and you have to wait to give him an answer until your bookkeeper can look that information up for you?

With a virtual accounting office your books are available to you 24/7. With a secure login you, your bookkeeper or accountant can pull up company records wherever there is Internet access. In real time, you have access to your books and are able to answer that customer 's question about his balance when he calls.

Want to know how much you have paid a vendor this year but dont want to wait to ask your bookkeeper for that report?

With a virtual accounting office you could run a report to give you that information anytime you wanted. A virtual accounting office can give you instant access to your accounting information, including your taxes, profit/loss reports, balance sheets and bank statements, all from the comfort of your own office, home, or anywhere in the world you may be.

Are you tired of printing paper checks you have to sign, stamp and then mail? Do you currently pay some bills through your online banking system, some bills with paper checks, some bills with credit cards, and some with automatic withdrawals, all the while never quite knowing your cash balance?

A virtual accounting office will save you time by locating all of your payables, all automatic withdrawals, and all deposits into one accounting system. You can pay your bills when you want, easily and directly through your online accounting program. You can also track any payment quickly and easily since you have only one place to look.

A paperless bookkeeping system though a virtual accounting office will streamline information into one accounting program. Now you will always know your available cash balance.

How much better would your business be if all your accounting needs were handled without the clutter of paper, through a Virtual Accounting Office, giving you more time to focus on your business? I would cut this sentence, repetitive. The last sentence is a strong close.

As a wise man once said, Dont sweat the small stuff. Let others do it for you. A paperless Virtual Accounting Office can do exactly that.