Most businesses I work with tend to give me their receipt, bank statements and personal expenses all mixed in a bag one week before filing. This stresses me out tremendously as I am only one person. Please use my organizers that will give you an idea of what to save and how to plan during the year.
These worksheets were created by the Tax Book. They help you to organize your receipts and come up with dollar amounts for each business deduction.
You need to devide you receipts into the following categories
Business only receipts (Schedule C: Profit or Loss from Business-Sole Proprietorship)
Business miles driven
Office supplies including ink, paper, software charges
Advertising and Marketing
New Equipment purchased
Invoices and cash receipts from customers to track payments
Meals and entertainment for customers only
Payroll and outside labor (provide 1099 to all paying over $600)
Meetings, memberships and dues as the Chamber
Travel and education courses related to your business only
For people who work out of their homes also include the following
Office and Home (Form 8829 - Expenses for Business Use of Your Home filled with Scehdule C)
Utilities and bills
Repair and maintenance bill on your home
Internet and celphone
Itemized deductions are personal in nature (Schedule A: Itemized Deductions - part of Form 1040)
State taxes paid
Personal Property Taxes
Home morgage interest
Gifts to Charity
Charitable Discounts on invoices
Adjustments to Gross income (From 1040 US Individual Tax Return page 1)
Student loan interest
educator expense for teachers
Individual retirement account
alimony paid is applicable
Tax: (IRS: Form 1040-ES and State Tax: CT-1040ES)
State and Federal taxes are kept separate because you cannot write it off as a business expense. Keep record of your estimated tax payments including date paid, amount, check numbers, or debit account info.
Self empoyment tax (medicare & social security) are already calculated and added to your estimated taxes. Your portion is 15.3% of your net profit.
IRS Tax (Form 1040-ES)
State Tax: (CT-1040ES)
Medicare and social security (Form 1040 page 2 line 65)
Your business expenses should be totalled at least quarterly so that you know how your business is doing and that you have collected all of you invoices and billed for all of your billable hours.
Reconcile your business checking account at least every month. This includes balancing income in and expenses out to make sure you have not missed anything. This helps you to identify your business income and expenses to get your net profit for tax estimates.
You should have a business checking account with your business name on it. Do not mix and business . Make sure you have a business charge card to use for coffee, travel, gas, new equipment and so forth to keep your personal expenses separate. If you have paid business expenses from personal funds you must make adjusting entries to your business account before the end of the year.
If you require bookkeeping services sort your receipts according to the top categories and provide me with quaterly bank statements. I will then prvide you with a profit and loss statement and or a business balance sheet. Contact me to scheudle an intake interview.