Some Record Keeping Tips for Taxes
Here are some basic
sorts to help categorize and make the tax stuff a little less
burdensome.....
Make files for the year
and save the following:
1. All invoices,
receipts for merchandise (inventory - expenses) This is your Cost of
Goods. If you pay with paypal, print your receipt note exactly what it
was for, and put it in there. If you pay by check/moneyorder - staple
the check to the invoice - you've then got proof you paid it. If you
pay by CC, staple the receipt to the invoice. Be sure and save ALL your
credit card statements so you can prove what was paid on those
purchases.
2. All Utility Bills -
when paid, write check number on it that it was paid with and file it in
here. This includes, electric, heat, phone, internet, etc. Also
include in here your mortgage or rent payments - especially if you have
a home office. Staple cancelled checks
to anything and everything to prove the payment. Also property taxes on
your home.
3. All Office Supplies,
paper, pens, pencils, file folders, software, etc....anything pertaining
to the office operations.
4. All Advertising
expenses - print paypal receipts, make note what it was, etc. business
cards, letterhead, labels, - those things are all advertising expenses.
5. Anything you had to
pay for repairs/maintenance, on computers, or on anything in your office
area.
6. Outside services.
Any receipts, expenses for outside services. - Like Hosting Fees, Like
scripting, Like web design... etc.
7. Any wages paid
8. Shipping and Freight
Expenses (USPS/UPS whatever - they all group together here)
9. Merchant account
fees - your monthly merchant statements, stapled to a copy of your bank
statement showing deposits and fees paid. Highlight the pertinent info
so it's easy to find.
10. Health Insurance
paid. If you kick in any for health insurance as self employed make
note of it.
11. Any loans you have
for the business, keep track of interest paid. The interest is usually
deductible.
12. Any vehicle
expenses. Usually it's best to keep a log - how many business miles
have you put on your vehicle. It's best to take the mileage reading on
the 1st of the year. Every time you make a business trip write down how
many miles in your log. Add it up each month, then add all 12 months
worth at the end of the year. 12/31 take the mileage reading on the
vehicle again. This is how you figure the % of business use. You can
also keep all records of expenses paid on the vehicle for oil changes,
tune ups, tires, repairs. But usually the mileage deduction is the best
bet.
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