If you want your accountant to speak to you after April 15, it’s time to start getting your tax documents in order. As a business owner, you need to have organized financials—both for yourself and your accountant.
Dig out that shoebox of receipts and get it together. It feels like an overwhelming task, to be sure, but it doesn’t have to be. Set aside a few hours each day next week and work through one task. By the end of the week, you’ll be ready for year-end and your accountant
- Sunday: Go to your local office supply store and buy a pack of at least 12 manila folders. (Bonus points if you buy 24: 12 for 2016 and 12 for 2017.) Label each of them January through December.
- Monday: Dig out that shoebox of receipts and file them by month. Be sure to find the receipts that are sure to be hiding in your email inbox too. Print these and file them in the appropriate folder.
- Tuesday: Log into your bank account and print your business bank statement(s) for each month this year. If your statement end date is mid-month, use the start month for filing.
- Wednesday: Sift through your files and earmark any large purchases for the year. Write those large purchases on the outside of the folder for that month so your accountant sees it right away.
- Thursday: Find last-minute expenses, like charitable contributions or taxes paid out from the prior year. Make note of these on the outside of the folder and include documentation in the monthly folders.
- Friday: If the same accountant is doing your personal taxes (which I recommend), sort through your personal receipts and paper clip them together by month. Then add these to your folders, with a sticky note labeling them as personal. Add up all the expenses for each month, then total them for the year for your accountant (your CPA will charge you to add it all up for you!).
- Saturday: Party like it’s 2017—because you’re ready for tax season!
Next year, be ahead of the game and save the headache of sorting through a year of receipts. Hire a bookkeeper or have your books set up for success, starting on January 1. Later this month, I’ll let you know how to do exactly that.