Filing your taxes doesn’t have to be a stressful affair. Here are a few ways you can keep organized throughout the year before presenting your documents to your tax preparer (plus, they’ll thank you for it).
Keep all Your Receipts
Take a picture of your receipts with your smartphone or scan them – just make sure that you are saving your receipts! The IRS can audit you up to six years back so it’s important that you save a history of purchases just in case. Chances are, you likely won’t remember why you bought that printer from five years ago, so we recommend you write notes on each receipt explaining the business nature of the purchase.
Sort and Categorize Financial Documents
You’ll also need to provide other documents like income, records of bank statements, canceled checks and paid bills. Once you have all the documents gathered, divide them into separate categories, such as home-office expenses, utilities, office supplies, and charitable contributions. Having these items organized beforehand will make it much easier for your tax preparer to calculate totals.
Find a Bookkeeping Strategy
Take a small amount of time each day, week, or month to tally up expenses. Stay ahead of tax dates with our blog, Important Tax Dates 2020. If you find that you are too busy, consider hiring a professional bookkeeper to manage these documents. Hiring a bookkeeper can help you save time and get your accounts neat and ready for the next tax season. Get in touch with our team at Bakersmith Bookkeeping Group to get started with financial reporting, training, and more!