How was your tax season? Was it a lovely and pleasurable experience, like sinking into a warm bath? Or unmitigated chaos? If you’re like most small business owners, you’re rubbing your temples right now and thinking “Do you seriously have to ask?” So, let’s talk about your bookkeeping checklist.
Tax time is stress time no matter how you look at it.
But instead of scrambling at the end of the year to get your financial house in order, you can avoid a tax-time hangover by working a bookkeeping checklist into your weekly and monthly routine.
Check out these bookkeeping checklists that help you keep your small business finances in order all year long. Work these into your routine, and tax time will be a breeze!
For the purposes of this blog post, we’re assuming you’re a sole proprietor with no employees. If you have employees, you may have more tasks on your list, such as issuing payroll and remitting federal payroll taxes.
Weekly bookkeeping checklist
Add these tax-related tasks to your weekly to-do list:
1. Enter and review all expenses in your bookkeeping program
Use a service like GoDaddy Online Bookkeeping to keep track of every single expense that flows out of your business.
This is one of the most important bookkeeping tasks you’ll tackle, because you’ll need this to take tax deductions once tax time rolls around.
You could end up in tax trouble if, at the end of the year, you’re not sure if that $451 credit card transaction from Walmart was for new equipment, office supplies or a personal expense.
Luckily, GoDaddy Online Bookkeeping will connect with your bank or payment method and automatically import transactions. If you’re using a service like this, your job here gets a little easier. Just review that all the transactions are correct and make sure they’re properly categorized. From there, you’ll be all ready to fill out your Schedule C tax form once annual tax time rolls around.
2. Record payments and income
Record any incoming invoices or other business income. You’ll need to a full accounting of your income to:
- Pay the right amount in quarterly estimated taxes.
- Prepare your annual tax return next year.
This is also a good time to make sure your clients and customers didn’t make a mistake and over or underpay. After all, we’re only human!
3. File or digitize receipts
Receipts look like clutter, but you’ll need a record of them in case of an audit. File them away where you can easily get your hands on them, or better yet, digitize them so you can Marie Kondo your physical filing cabinet.
Too time consuming? There are also services that will digitize your receipts for you.
Related: 6 ways to simplify your bookkeeping
Monthly bookkeeping checklist
1. Balance your financial accounts
In other words, open your checking account and credit card statements and be sure that nothing fishy is going on. This can be as simple as scanning over all of your checking and credit transactions to ensure that you weren’t overcharged or double-charged and making sure there was no problem with any deposits from vendors.
Also be on the lookout for common issues like checks that never cleared, and refunds and credits that never processed.
2. Send and review invoices
Issue invoices to your clients. Can’t remember if you’ve invoiced or not? GoDaddy Online Bookkeeping’s Invoices feature allows you to see all of your invoices — as well as their payment status — in one place.
Also check the status of outstanding invoices. If someone’s past due, send them a friendly reminder. After all, cash flow is the life blood of a business.
3. Review and pay invoices
Make sure you’re up to date paying all of your vendors. Always double check your incoming bills to be sure you got what you paid for and that you’re still getting enough value for your money.
How to find the time for bookkeeping
You may be thinking “I’m over here trying to serve my customers and keep my head above water. Where do I find the time for a bookkeeping checklist?”
Experts recommend dividing your tasks into an A/B schedule.
Long story short, prioritize your most important tasks — the ones that pay the bills, and focus deeply on them. Then, assign a time for less vital tasks. While bookkeeping is vital, it also shouldn’t be your “A” priority.
For example, make an appointment with yourself to deal with your books every Thursday at 3 p.m., then spend the rest of your time serving customers and bring home the bacon.
Intrigued? You can read more about managing your valuable time with an A/B schedule.
The post Weekly and monthly bookkeeping checklist for small business owners appeared first on GoDaddy Blog.
Source: Go Daddy Garage
Originally posted 2019-04-15 08:30:22. Republished by Blog Post Promoter