As any business owner can attest to, there are not enough hours in the day, and life as a business owner can be hectic. If you run a business, regardless of how large or small your company is, you must ensure that your books and accounts are in order. The last thing you want to deal with is an audit from the IRS when you have so much on your plate. As tempting as it is to put off, it’s worth catching up on backlogged bookkeeping before tax season comes around. Here are some tips to help you catch up on your bookkeeping.
You may think that automated accounting software is only reserved for big companies. But in today’s age, half of the small businesses have automated workflows for various business tasks to use within teams. In this case, you can automate your bookkeeping so that your numbers remain exact and accurate in your accounting software. Doing your bookkeeping by hand makes it prone to errors and takes up a lot of time and energy. But automation tools can maintain and update records with accuracy and speed.
Keep Documents Organized
The best way to avoid falling behind on your books is to keep everything organized during the year. It’s vital to keep all of your records and documents organized by category to make filing your taxes that much easier. Keep invoices, receipts, bank statements, and any other records and documents in a filing cabinet or folder so that you can find them when you need to. Taking a few extra minutes to store essential documents in a filing system instead of all over your desk will make life much easier in the long run.
Reconcile Your Bank Accounts
It’s essential to reconcile your bank accounts to identify any errors in your business or bank records. To ensure each account is balanced, be sure to compare each transaction from your bank statement with the same transaction in your business accounting records. If they don’t match, identify and fix any errors, so the balance in your bank statement matches the balance in your company records.
Collect Important Tax Forms
If you have employees or independent contractors on payroll, you must have the appropriate tax forms for each person you hire. If you paid an independent contractor over $600 this tax year, you must submit a W-9 and 1099-MISC form. A W-9 requests a contractor’s taxpayer information. The contractor will complete this and return it to you. You then use the information on the W9 to issue a 1099 to the IRS. Basically, the IRS requires a 1099-MISC form to track payments to independent contractors.
Contact Bowman & Company Today
Bowman & Company CPA, PC provides all of our individual and small business customers with experienced, accurate, and affordable financial services. Our financial services aim at decreasing your taxes and increasing your net worth through responsible, timely, and accurate recordkeeping. We offer our services to clients throughout the Washington, D.C. metropolitan area including Maryland and Baltimore County, Columbia, and Howard County. For more information on our offerings, contact us online or call us at (410) 381-8121. You can also find us on Twitter, Linkedin, Facebook, and Youtube.